Happy New year!
The new year was more of a traditional year as far as rallies go. Santa’s trip to town was full of presents. If you didn’t get a whopper of a profit from mid December to mid January that probably was quite an incredible underachievement, since unless you had a portfolio of cash the stock markets boomed. Then of course everyone takes a breath and then China sneezes.
It was because of China’s trade war with the US in the January 2019 dip that markets fell up to 20%. Once again China spoils the party with a killer virus that it has successfully exported worldwide that has dampened the markets enthusiasm. So unless you were investing in a company making surgical masks chances are by the end of the month most holdings you held all ended in a bit of disappointment.
Once again it shows the crucial importance that the Chinese markets play in world markets. Brexit has little impact on world markets when compared with a Chinese lockdown because of a nasty virus. With markets trembling at a China slowdown oil prices plunge as investor speculate a global recession. While a couple of hundred people dying of a virus is a tragedy, more people are killed in car accidents in just a couple of days in China. Markets never react logically and that is how investors can win. So oil stock are down up to 10% since the Iranian missile crisis when investors feared oil instability at the beginning of January.
So with oil already at big lows, I think a FTSE 100 stock like Shell and BP are trading very cheaply. You are not going to see great growth on these stocks, but as far as a reliable blue chip companies go I think they are offering a fairly low entry point.
I expect the markets will pick up once the hubbub dies down and I would imagine that most Chinese stocks are probably being unfairly damaged. The service sector would be hit naturally - but manufacturing industries are unlikely to suffer much in the long term. There is no ban on exporting goods, it’s just the people!
Anyway - so despite ending on a bit of a downer, did you have any picks.
My clear winner was Blue Prism - 57%. this small cap company specialises in software for robotic automation and if you had it 4 or 5 years ago it would have been a 10 bagger.
Beyond meat was hot on its heel with a 45% rise. Reduces my awful losses on this stock. Less said about that the better!
On the naughty step this month Fever Tree has been uprooted rather with a 34% plunge as growth has slowed and investors are reality checking their expectations. Thankfully my holding in this one is minimal. The same cannot be said for NMC which also has had a bit of coughing fit as it dived 20% as the accounting fraud scandal rumbles on.
So let’s hear from all the traders! Thoughts and comments?
As per Freetrade’s policy always remember to do your own research.
Remember that past performance is no guarantee of future performance.
This is a discussion only thread and is not advice to invest in any particular stock.