Welcome to this week’s Market Wrap. Western stock markets finished the week broadly flat, but March ended up being positive for most. Markets are generally on their way to recovering the worst of the hit that followed Russia’s invasion of Ukraine in late February. This is generally in line with the average time it takes for equity markets to recover from dramatic geopolitical events. But for Ukrainians, of course, the devastation continues to be utterly horrendous, and will be for a long time to come.
Index changes
This Week | 1 Month | 1 Year | |
FTSE 100 | +0.9% | +3.0% | +11.0% |
FTSE AIM All Share | +0.6% | +1.6% | -13.5% |
S&P 500 | -1.0% | +5.2% | +12.7 |
FTSEuroFirst 300 (ex-UK) | -0.8% | +3.5% | +5.2% |
S&P/ASX All Ordinaries | +1.2% | +5.4% | +10.2% |
Source: Stockopedia, London Stock Exchange
On a one-year basis, UK small-cap growth stocks - as measured by the AIM All Share - are still well off the pace of large-cap indices. But even AIM has seen signs of positivity over the past couple of weeks. It’s really rather early days, but there are a lot of small-cap investors feeling the pain at the moment, so a sustained uptrend here would be welcome.
Source: Stockopedia -12 month performance (weekly) FTSE 100, S&P 500, FTSEurofirst 300 exUK, S&P/ASX All Ords
On a personal note, my own factor-driven, Naps-style portfolio has been underwater since the start of the year. Small-cap growth shares, of course, have been the main detractors. It’s really only been the large-cap, defensive style stocks (that I didn’t really want to buy in the first place) that have kept things from being a lot worse! And on that note…
Defensive plays paying off…
In the UK, there’s a distinctly defensive feel to some of the strongest performances in the large cap FTSE 100 index. Among those trading close to 1-year highs are utilities like Severn Trent (LON:SVT), National Grid (LON:NG.), SSE (LON:SSE) and United Utilities (LON:UU.). But oil, commodities, healthcare and insurance are all up there too.
In some ways these recent index trends aren’t all that surprising. After all, these blue chip shares are global businesses; they’re attractive for their defensive traits at a time when no-one really knows how world events will develop.
A number of them are benefiting from rising commodity prices at home and abroad. Many were also reasonably priced over the past year and so they’ve appealed to value investors (who…
