- Donald Trump’s historic second state visit to the UK came to an end on Thursday.
- State visits are increasingly being used for political purposes to win favour and investment.
- CEOs of Apple, Nvidia, Microsoft and OpenAI committed a total investment of £31B during the formalities.
Donald Trump’s second state visit to the UK has come to an end. The invitation, a clear attempt to curry favour with Trump, was well received, with the president hailing the state banquet on 17th September as “the highest honour of my life”.
Keir Starmer’s government has faced some significant issues recently and favourability ratings show Starmer to be one of the most unpopular leaders in the West1. The UK was the first country to strike a trade agreement with the US, that saw it avoid the worst of the tariffs faced by other allies. Starmer is trying to repeat that success with further diplomatic and business wins that he can advertise to the electorate and his MPs.
Source https://www.theguardian.com/politics/2025/sep/09/how-keir-starmers-polling-became-one-of-the-worst-in-the-west-in-charts
The red carpet of Windsor Castle rolled out on Wednesday with banquet dinners, meetings with senior members of the royal family, and bilateral meetings with Keir Starmer on the agenda.
Trump and Starmer also hosted a business reception with probably the most popular people in the world, Sam Altman of OpenAI and Nvidia Corp’s Jensen Huang, to discuss billions of dollars of investment in UK data centres. Various American and British companies have taken this opportunity to announce multi-billion-dollar investments in the UK economy, perhaps giving Starmer the lift he desperately needs.
State visits are a thinly veiled charm offensive, designed to strengthen ties between two countries for mutual economic benefit. There have been many instances in history where the pomp and circumstance the UK does so well has been leveraged to maximum effect.
Peter the Great of Russia conducted one of the earliest diplomatic foreign tours in 1697 and 1698. The primary goal of the mission was to strengthen Russia’s alliance against the Ottoman Empire while hiring foreign specialists for Russian service and acquiring military weapons. In 1698 the Tsar visited and explored shipyards, artillery plants, and institutions like the Royal Observatory and Oxford University. Peter left with dozens of British experts to aid Russia’s development. His visit also helped revive Anglo-Russian trade and sparked two decades of strong British influence in Russia. As a bonus, Peter was prepared to support William in the Nine Years’ War against France.
Napoleon III and Empress Eugénie made a visit to the United Kingdom in April 1855, meeting Queen Victoria and Prince Albert. In a brief period not fighting with the French the visit symbolized the successful Anglo-French alliance during the Crimean War. The visit included stays at Windsor Castle and Buckingham Palace, a State Dinner, a visit to the Crystal Palace, and a trip to the Covent Garden opera.
George Bush was the recipient of the largest guard of honour bestowed upon a foreign leader2. The visit came at the peak of the UK–US “special relationship”, which helped bolster bilateral trade and investment, particularly in sectors like defence, energy, and finance.
Over the last 20 years, net inflows of foreign direct investment (FDI) into the UK have fallen3 – figure 2. However, at latest count Trump’s visit has resulted in £31B of investment commitments from tech giants including Microsoft, Google and Nvidia – which is broadly 1% of UK GDP4.
Source: (FDI)https://data.worldbank.org/indicator/BX.KLT.DINV.WD.GD.ZS?end=2024&locations=GB&start=2004&view=chart
Bowmore portfolios
Compared to the proportions in the global stock market we are overweight the UK stock market. We feel the UK offers better value than the US where valuations appear stretched. The below image illustrates how the Price/Earnings (P/E) ratio for the US stock market influences subsequent 10-year returns. Starting at levels we find ourselves at today generally results in very low returns over the following 10 years. The UK stock market, however, sits at a 40% discount to the US market on a P/E basis5 offering a more attractive entry point.
Source: JP Morgan
The UK stock market typically consists of more defensive industries too; the FTSE 100 consists of 11% energy companies’ vs 3% for the S&P500, 18% consumer staples vs 5% for the S&P500 and 1% technology vs 33% for the S&P500. Therefore, as the road ahead looks particularly unclear with tariffs, uncertain monetary policy, ballooning government deficits and frothy valuations in the tech sector, we are happy to be owning a larger proportion of more cautious UK assets.
Source: AlphaTerminal, data as at 18/09/2025
The value of your investments can go down as well as up, so you could get back less than you invested. Past performance is not a guide to future performance.
Sources:
1. How Keir Starmer’s polling became one of the worst in the west – in charts | Keir Starmer | The Guardian
2. State and official visits to the United Kingdom – Wikipedia
3. World Bank Data
4. Microsoft, OpenAI Herald Trump’s UK Visit With Spending Pledges – Bloomberg
5. JP Morgan