Friday Email: 06 December 2013
Every Friday morning our lead analyst Mark Riding sends out his weekly run-down and upcoming events in the investor calendar, like this one:
A sad day as the world reflects the passing of Nelson Mandela.
It is a funny time of the year when everybody starts talking about a Santa rally and yet the start of December is invariably poor. After a pretty decent year so far, for the FTSE 250 mainly, traders and fund managment companies no doubt will try and lock in some of the more spectacular profits as the year end approaches. There are various spurious theories as to why there is the end of year rally and this year you have to wonder if it will be an opportunity to sell as we face more US budget woes and the beginning of the end of Q.E. as it is tapered. We should see a decent start to the year as new money comes into the market. Around the end of January, nervousness will creep in as the markets begin to doubt the ability of politicians to resolve amicably. That said, we still see equities as a well backed asset class for 2014 as a whole.
The market has been poor this week and the FTSE 100 has fallen 170 points in the past three days, whilst the FTSE 250 has fallen over 300 points, apparently as worries about Q.E. tapering emerge. Back to dividends and we can have no complaints on that front with increases from Greene King and ITE. There was another solid increase from Micro Focus and Betfair increased its interim dividend by 50%. Brewin Dolphin, after a few years of maintaining the dividend suddenly went for a 40% increase in their final dividend. Sage completed a good year of returns for its shareholders with a 6% increase in the final dividend. Yesterday saw really good numbers from Smith (DS) and a 28% increase in its interim dividend.
The week ahead looks fairly quiet and we will have an eye on Photo-me's results. Our best performing dividend of the week has tripled since we recommended it on 20/11/11, back in the early days of DividendMax.
The Friday email is delivered to over 20,000 subscriber’s every week, and remains a widely read run-down of recent events and what investors can expect in the week ahead written by our chief analyst Mark Riding.
It’s included as part of the free DividendMax trial.
Read next: 29 November 2013
The FTSE 100 has been trading sideways for a good while now. It is only up about 100 points from mid March and still sits almost 200 points below the high of 6840 reached in May. Compararison with the S&P 500 shows that the S&P has risen almost in a straight line this year from 1459 to 1807, up almost 24%. The FTSE 100 is up just over 10% in the same period. In a global market where multinationals operate in all the major economies that does seem to underpin UK stock market valuations at least in the large caps. Meanwhile the FTSE 250 has risen from 12375 to 15431 or 24.69% outperforming the S&P 500. It goes to show that if you are passive in your investments and picked out an index tracker, you still have to be careful.
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