Britain’s biggest fund manager, Neil Woodford, called the bottom of the stock market last week — following in the footsteps of veteran stockpicker Anthony Bolton.

Woodford, who manages £15 billion at Invesco Perpetual and is one of the best-known and best-performing managers in the UK, said at current levels British shares represented “some very good value indeed”.

He added: “Overall, UK equity market indices are now lower than 10 years ago and I think there are now good grounds for thinking the overall market has bottomed.”

The FTSE 100 closed on Friday at 4,449, or 28% lower than the 6,147 it stood at a decade ago.

Last month, Bolton, speaking exclusively to The Sunday Times Money section, said a fresh bull market would start in 2009 with investors likely to be caught out by the strength of the rally.

“Everything I need to see for a bottom is there. Valuations look cheap and you often get this kind of high intra-day volatility at a turning point,” Bolton said.

However, City analysts remain divided over whether the rebound since October’s lows is a bear-market rally or a new bull market.

We asked the experts for some of the signals that will say it’s time to buy.

US HOUSE PRICES STABILISE

The credit crunch started in the American housing market, with banks making sub-prime loans to borrowers who couldn’t repay them; many analysts therefore believe it will end only when the US housing market shows signs of stabilising.

European equities typically trough around six months before US house prices bottom out, investment bank Morgan Stanley said. It believes house prices in the States will not bottom until mid-2010, as this tends to happen after the peak in the unemployment rate.

That, said its economists, would happen in the fourth quarter of this year. Based on these indicators, the next bull market will start in the last quarter of 2009.

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