Shares & the stockmarket

30 March 2022

Bond markets signal recession warning, contrasting fortunes for miners Polymetal and Petropavlovsk, and Team17 quantifies hit from Russia/Ukraine war

“Recession is the word of the day after an important warning sign was triggered on the markets,” says Russ Mould, Investment Director at AJ Bell.

“Last night the yield on two-year US government bonds rose above that of the 10-year note, causing an inverted yield curve – something that has historically preceded a recession.

“Traditionally...

29 March 2022

FTSE 100 up on hopes for progress in Russia-Ukraine talks, AG Barr now ahead of pre-Covid earnings and Bellway lifts house price guidance

“Having tripped over on Monday afternoon amid concern about China lockdowns and the conflict in Ukraine the FTSE 100 sprang back to its feet on Tuesday on hopes the latest round of peace talks between Moscow and Kyiv might yield tangible progress,” says AJ Bell Investment Director Russ Mould.

“Suggestions the Russian side are softening some of...

28 March 2022

FTSE up on Ukraine-Russia peace talks as Shanghai locks down, and Ted Baker fights off takeover interest

“It almost feels like we’ve stepped back in time two years as lockdowns in China once again rock the markets,” says AJ Bell Investment Director Russ Mould.

“The two-day restrictions imposed in Shanghai are evidence that the pandemic is not yet over and inevitably, given the implications for global growth, have put oil prices under pressure.

“It...

25 March 2022

Big tech in spotlight as EU clamps down on anti-competitive actions, and Petropavlovsk could be facing a cash flow crisis

“It’s going to be an interesting day on the markets when the US wakes up, given how the European Union has firmed up plans to get heavy on anti-competitive practices among giant tech firms,” says Russ Mould, Investment Director at AJ Bell.

“So far pre-market indicative prices show minimal change in the prices of Apple, Alphabet, Microsoft and Meta...

24 March 2022

What does US bond market blitz mean for stock markets (and the economy)?

It was former US President Bill Clinton’s economic adviser James Carville who said that if he were reincarnated, he would like to come back as the bond market because then ‘you can intimidate everybody.’ Now that US bond yields are surging and prices are falling, stock market investors need to seriously think about whether it is time to be...

24 March 2022

Oil prices continue to rise, investors hide in defensive names, and Next downgrades guidance

“Brent Crude oil at $122 per barrel is going to be a tough one for businesses to stomach as energy costs go through the roof,” says Russ Mould, Investment Director at AJ Bell.

“The cost of running factories, moving trucks and powering computers will put a squeeze on profit margins which means corporate earnings expectations may have to be reduced...

23 March 2022

FTSE up ahead of mini-Budget, oil prices continue to rise, tech stocks in vogue, and Saga and Dignity sink

“The FTSE 100 has a spring in its step despite the UK inflation rate going up again, and a potential cut in the country’s economic outlook when Chancellor Rishi Sunak announces his mini-Budget at lunchtime,” says Russ Mould, Investment Director at AJ Bell.

“Headwinds for consumers and businesses linked to the rising cost of energy, raw materials...

22 March 2022

Western oil majors yet to ramp up capex despite higher crude prices

“Saudi Aramco is increasing its capital investment budget for 2022 to around $45 billion, compared to analysts’ consensus expectations of around $36 billion, as it recycles higher profits into efforts to increase oil output, but its Western oil major equivalents are being so much more careful,” says AJ Bell Investment Director Russ Mould.

“Although...

22 March 2022

FTSE 100 closes on pre-invasion levels, Nike finds some air on strong trading, banks higher on Powell's rate hints

“The FTSE 100 extended its recent strong run and is now not too far off the levels it reached before the Russian invasion of Ukraine and only marginally lower year-to-date,” says AJ Bell Investment Director Russ Mould.

“This doesn’t mean investors have shrugged off the first major war in mainland Europe in a generation but it reflects an index...

21 March 2022

FTSE 100 claws back most of its 2022 losses and Evergrande’s shares suspended

“After bouncing back last week, the FTSE 100 is now within a whisker of clawing back all the losses incurred year to date. This resilient performance has helped to put the UK back on the map for overseas investors looking to diversify their holdings,” says Russ Mould, Investment Director at AJ Bell.

“To put its performance into context, the FTSE...

18 March 2022

Dramatic week on the markets draws to a close, private equity interest in Ted Baker and JD Wetherspoon faces costs challenge

“Investors have been subjected to significant forces this week. Heightened geopolitical tension, rising interest rates in the US and UK, and China’s pledge to stabilise markets have all been on the agenda and served to shake equities,” says Russ Mould, Investment Director at AJ Bell.

“Fortunately, the week looks like it will end on a calmer note...

17 March 2022

Ferguson fails to fire up investors despite bumper earnings and more buybacks

“ Ferguson’s chief executive Kevin Murphy must be wondering quite what he has to do to make investors happy, as huge jumps in first-half sales and profits, a 15% boost to the dividend and a $1 billion expansion of the company’s buyback programme is making no difference to the share price at all,” says AJ Bell Investment Director Russ Mould.

“May’s...

17 March 2022

FTSE higher after Fed rate hike, Deliveroo and Cineworld up despite big losses, Ocado hit by margin warning

“The FTSE 100 eked out some gains Thursday morning after the US Federal Reserve moved to raise interest rates for the first time since 2018,” says AJ Bell Investment Director Russ Mould.

“The Fed could not really have telegraphed the move any more if all its representatives had been holding quarter point raise banners everywhere they went for the...

16 March 2022

Chinese stocks surge, markets await US interest rates, and Restaurant Group is beating its rivals

“It could be a rollercoaster of a day on the markets as events in China and the US dominate the agenda,” says Russ Mould, Investment Director at AJ Bell.

“After a big sell-off in Chinese stocks on Monday and Tuesday, Beijing has stepped in with pledges of support to try and stabilise markets. This has resulted in a big rebound in the Hong Kong...

15 March 2022

Asian markets flash red again, miners slump and Ocado wins another technology deal

“Asian markets were troubled for the second day in a row as investors weighed up the potential hit to corporate earnings and economic growth from new Covid lockdowns in China, particularly in the electronics manufacturing sector where disruption to production could lead to another supply chain crisis,” says Russ Mould, Investment Director at AJ...

14 March 2022

Chinese stocks sell off on new Covid lockdown and Rio Tinto bids for Mongolian project partner

“China is at the centre of a new storm which threatens its economic growth and credibility with the Western world,” says Russ Mould, Investment Director at AJ Bell.

“Two forces have served to shake its markets, leading to a 5% slump in Hong Kong’s Hang Seng index and a 2.6% decline in the Shanghai SSE Composite index.

“First is renewed lockdown...

11 March 2022

FTSE ends the week on a brighter note, Ocado wins again, housebuilders in demand, and Cineworld jumps ahead of next week’s results

“After a mid-week rally for stocks, Thursday’s session saw a bucket of cold water poured over markets in Europe, Asia and the US,” says Russ Mould, Investment Director at AJ Bell.

“The war rumbled on, new inflation figures gave a stark reminder how the cost of living is going up fast, and the European Central Bank implied that eurozone interest...

10 March 2022

FTSE drops after wild swings in oil prices, while Boohoo rallies but still faces big challenges

“Wild swings in oil overnight reflect the febrile nature of markets right now and also just how little visibility investors have,” says AJ Bell Investment Director Russ Mould.

“The 17% drop in crude prices, after UAE signalled a willingness to increase production, would certainly help to reduce inflationary pressures which had intensified since...

9 March 2022

Most popular ISA investments of 2022 so far

ISA investors are keeping the faith with Fundsmith Equity and Scottish Mortgage, despite some lower performance in the first two months of this year. Scottish Mortgage fell by 25% and Fundsmith Equity fell by 13%, which compares to a 7% fall in the MSCI World Index over January and February. All active approaches will go through periods of...

9 March 2022

European markets rebound as investors fish for bargains, and slimmed down Prudential impresses

“Markets across Europe saw strong gains on Wednesday following decisions by the UK, US and EU to ban or curb Russian oil and gas imports, thereby putting further financial pressure on Russia,” says Russ Mould, Investment Director at AJ Bell.

“After a strong run for commodity producers on the market, names like Rio Tinto and Glencore slipped back...

8 March 2022

Stagflation fears stalk markets and rising costs to take a bite out of Greggs’ expected

“After a Lazarus-like turnaround yesterday the FTSE 100 was back under pressure on Tuesday as the war in Ukraine grinds on and approaches the end of its second week,” says AJ Bell Investment Director Russ Mould.

“It’s hard to believe that just a fortnight ago a full Russian invasion was considered the worst end of a range of scenarios, oil was...

7 March 2022

Commodity prices soar, more directors leave the boards of London-listed Russian companies, and manufacturing M&A deal is off

“After a week of businesses around the world cutting ties with Russia in protest at its invasion of Ukraine, the market is now taking a serious look at what would happen if no-one bought the country’s commodities,” says Russ Mould, Investment Director at AJ Bell.

“So far there have been no country-level sanctions on Russian commodity products...

4 March 2022

Taking stock of events as markets continue to fall

“With the invasion of Ukraine by Russia now into its second week, stock markets continue to battle the threat of even higher inflation and a potential economic slowdown,” says Russ Mould, investment director at AJ Bell.

“Since the invasion began on 24 February, Germany’s DAX index has fallen by 8.3%, Hong Kong’s Hang Seng index has dropped by 7.4%...

3 March 2022

Croda share price crumbles even as earnings and dividend grow

“The pricing power conferred by Croda’s business model and its strong position in its chosen markets shines through the full-year numbers, as sales, profits, profit margins and the dividend are all higher. However, the share prices just does not seem interested,” says AJ Bell Investment Director Russ Mould.

“The latest slide means Croda shares are...

3 March 2022

FTSE lower despite resources strength as inflationary impact of war in Ukraine becomes clear, ITV shares slump as it reveals new streaming service, and Melrose holds back on capital return amid conflict

“Not even continuing strength in the oil and gas market and the resulting upswing in BP and Shell shares could save the FTSE 100 from a fall on Thursday,” says AJ Bell Investment Director Russ Mould.

“Investor nervousness is perfectly understandable as we won’t know the full impact of the conflict sparked by Russia’s invasion of Ukraine for some...

2 March 2022

Oil hits $110, BP and Shell lift FTSE 100, Polymetal rebounds after ’going concern’ analysis, and MusicMagpie hit by margin pressures

“The FTSE 100 made its latest attempt at a rebound on Wednesday despite the ongoing conflict in Ukraine,” says AJ Bell Investment Director Russ Mould.

“Index heavyweights BP and Shell were markedly higher as oil prices moved to eight-year highs above $110 per barrel.

“The latest surge in crude came despite the International Energy Agency...

2 March 2022

Stand out funds for this year’s ISA allowance

The 5 April deadline for using this year’s £20,000 ISA allowance is rapidly approaching and with Cash ISA rates remaining low, many investors will be turning to the stock market to try and ensure their savings can outpace rampant inflation. Individuals will be looking for fund options that suit the amount of risk they want to take in their...

1 March 2022

Eerie calm in markets despite war in Ukraine, and Travis Perkins could find life harder

“The fairly calm mood in the markets seems at odds with the escalating conflict in the Ukraine as the FTSE 100 ekes out modest gains on Tuesday following progress in Asian markets,” says AJ Bell Investment Director Russ Mould.

“Investors, like almost everyone else, have little insight into what happens next in Ukraine or how Russia might respond...

28 February 2022

BP to offload Rosneft stake, Russian companies sink on London market, Associated British Foods contends with margin pressures

“In a move that feels seismic but at the same time completely unsurprising, BP has announced plans to offload its stake in Russian oil company Rosneft,” says Russ Mould, Investment Director at AJ Bell.

“Remaining invested in Rosneft could almost be literally construed as fuelling the Russian war effort and that would not have been a sustainable...

25 February 2022

FTSE 100 makes gains despite Ukrainian conflict, International Consolidated Airlines continues to lose money, and Rightmove to face a downturn test

“Despite war continuing to rage in Ukraine the FTSE 100 managed decent gains on Friday as investors make slightly queasy calculations about the extent to which the economic and market impact of Russia’s invasion will be contained,” says AJ Bell Investment Director Russ Mould.

“The index took its cue from a dramatic reversal in the US overnight...

24 February 2022

How to inflation-proof your ISA

Inflation is now forecast to peak at over 7% in April, which naturally has many people worried about how that will affect their savings and investments, and as we head towards the end of the tax year, that concern will no doubt affect how savers allocate their ISA allowance. Current high rates of inflation mostly reflect price rises that have...

24 February 2022

Cash ISAs hit with record outflows as interest rates, urgency, appeal and spare cash dwindle

Cash savers pulled more than £7bn from bank and building society ISAs in the last six months of 2021 – marking the biggest outflows from ISAs since they were launched in 1999. Poor interest rates, the cost of living crunch and the dwindling appeal of cash ISAs have all played into these outflows.

ISAs generally see outflows in the second half of...

24 February 2022

Market reaction to Russia invading Ukraine, and Rolls-Royce slumps on weak results and Warren East departure

“Markets across Europe and Asia dived on confirmation that Russia had invaded Ukraine. A 2.6% decline in the FTSE 100 paled into comparison to other markets including a 3.5% drop in Germany’s DAX and a 3.2% slump in Hong Kong’s Hang Seng,” says Russ Mould, Investment Director at AJ Bell.

“That is partially down to the UK market having a large...

24 February 2022

Antofagasta faces big cost increases in 2022 as copper price holds firm

“Copper carries the nickname ‘Dr Copper’ because the malleable and ductile industrial metal is used so widely in so many industries that it is seen as a good guide to global economic health. In some ways investors should therefore be pleased to see copper trading near $10,000 a tonne, although the metal’s recent price strength could also be down to...

23 February 2022

FTSE higher on hopes for de-escalation in Ukraine, Rio Tinto declares bumper dividend, and Barclays beats expectations

“The FTSE 100 managed a move higher on Wednesday despite the simmering tensions in Ukraine,” says AJ Bell Investment Director Russ Mould.

“The US seems to have ruled out any talks with the Russians until they pull back from the separatist regions in the Donbas region they occupied yesterday so the ball now appears to be in Vladimir Putin’s court....

22 February 2022

Passive Favourite fund updates What is the AJ Bell Favourite funds list?

The AJ Bell Favourite funds list is designed to lighten your research load. There are thousands of funds out there – so we’ve narrowed the field by selecting a high-quality shortlist of funds we believe can deliver their objectives over the long term. To make the list, each fund needs to pass our robust...

22 February 2022

Markets shaken by war threat, HSBC delivers a mixed bag, and Smith & Nephew appoints new boss

“The threat of war does not create a positive environment for investors, and so we have seen another big sell-off on global markets. The movements include a 7% drop in Russia’s RTS index and a 1.7% decline in Japan’s Nikkei 225 index,” says Russ Mould, Investment Director at AJ Bell.

“Investors are very much in risk-off mode, dumping commodity...

21 February 2022

Markets up on hopes for Biden-Putin summit, and UK takeover spree continues with a move on Clipper Logistics and a higher bid for John Menzies

“The market remains hopeful that Russia will step back from the precipice in Ukraine with news of a potential last-gasp summit between Putin and Biden lifting sentiment on Monday,” says AJ Bell Investment Director Russ Mould.

“Like everyone else investors are left scratching their heads trying to decipher what the Russian leader’s end-game is and...

18 February 2022

FTSE 100 higher but Ukraine fears remain, Walmart is a winner, Natwest cost inflation spooks market

“The FTSE 100 ticked higher on Friday as nervousness around a potential all-out conflict in Ukraine persists,” says AJ Bell Financial Analyst Danni Hewson.

“Better-than-expected retail sales suggest that, for now, the increased cost of living is not preventing Britons from hitting the shops.

“Expect that to be tested through the course of the...

17 February 2022

Reckitt boosted by upbeat margin guidance, Moneysupermarket can’t help where it’s really needed, and Russian tensions return as FTSE starts lower

“A good business wants to sell more products each year than the previous 12 months. Success is a sign that either existing customers want more of their goods, they’ve attracted new customers, or a mixture of both,” says Danni Hewson, Financial Analyst at AJ Bell.

“ Reckitt Benckiser has followed Unilever’s lead by reporting higher like-for-like...

17 February 2022

AJ Bell funds update

The AJ Bell funds are managed by the team at AJ Bell Investments, with one aim: helping you invest. We look after the funds and make the daily decisions to keep your money working hard for you.

That means, from time to time, we’ll make updates to the funds in response to differing market conditions. In this article, we’ll take you through the...

16 February 2022

The Cash ISA paradox – rates are rising, but things are getting tougher for savers

Cash savings have suffered death by a thousand rate cuts over the last decade, but the cash paradox is that even though rates are now on the up, things look like they will get even tougher for savers. That’s because elevated inflation is going to eat up any gains from higher interest rates on cash and will take an extra pound of flesh for its...

16 February 2022

Market reaction to UK inflation figures

“The FTSE 350 behaved exactly as you would expect as UK inflation hit a 30-year high at 5.5%. Many of the top risers and fallers are affected by the rising cost of living,” says Danni Hewson, Financial Analyst at AJ Bell.

“Among the risers, banks including NatWest got a lift as higher inflation strengthens the argument for higher interest rates...

15 February 2022

Income vs. accumulation units

Your choice of share class could affect your overall return.

Most open-ended investment companies (OEICs) and unit trusts are available in both income and accumulation share classes. The main difference between them is the treatment of income, but there are other less obvious factors that you need to recognise.

Each fund receives income throughout...

15 February 2022

Calm after the storm for markets as Ukraine fears ease, BHP and Glencore unveil big returns for shareholders

“Today marks something of a calm after the storm, as the FTSE 100 recovered some ground lost yesterday – when the market saw its biggest losses of 2022 to date,” says AJ Bell Financial Analyst Danni Hewson.

“The moves higher reflect some modest easing of tensions at the Ukrainian border, with Russian troops apparently returning to base for the...

14 February 2022

Markets rattled by prospect of Russia/Ukraine war

“The prospect of war is rarely good for stock markets, and so the new trading week has begun on a bad note across Europe and Asia as investors fear the alarm clock is about to sound on a physical battle between Russia and Ukraine,” says Danni Hewson, Financial Analyst at AJ Bell.

“The FTSE 100 was down 1.8%, erasing nearly all the gains year to...

11 February 2022

Market volatility creeps up and British American Tobacco is a cash machine

“It’s been quite a week for the markets with a shock from US inflation growing faster than expected, and now we’ve got confirmation that Omicron tripped up the UK economy in December, albeit by a smaller amount than forecast,” says Russ Mould, Investment Director at AJ Bell.

“Last night on Wall Street, US stocks took a tumble on fears that the...

11 February 2022

Falling debt helps to explain rising share price at BP (and Shell)

“While it is a surge in profits from both oil and gas that continues to grab the headlines at BP and Shell, the real secret to their share price success is how they have made the most and rising hydrocarbon prices and then put the bounty to good use,” says AJ Bell Investment Director Russ Mould.

“Both firms have cut costs, reined in capital...

10 February 2022

Unilever’s problems mount up, Disney’s earnings boost as visitors return to its parks, and markets await US inflation numbers

“Having been lambasted by investors for caring more about ESG factors than improving the day-to-day business, and then making a punchy takeover bid for GlaxoSmithKline’s consumer healthcare business, Unilever has dusted off its crisis management manual and followed the rule book of how to dig oneself out of a hole,” says Russ Mould, Investment...

9 February 2022

FTSE higher as packaging sector rallies, Dunelm is a retail shining star, and Barratt reveals solid foundations

“The FTSE 100 made a robust start on Wednesday, lifted by some decent corporate results and a rally in the packaging sector,” says AJ Bell Investment Director Russ Mould.

“ Smurfit Kappa helped lift its industry peers with guidance for rising prices that should benefit the entire space amid strong demand.

“Overnight John Foley fell off his bike...