Week 25 of 2012.
A relatively quiet week on the broader markets with any spaces of poor news from Europe being comfortably filled by the fast becoming laughing stocks – the credit agencies. One week it’s Moody’s the next it’s the Standard and Poors. There was a time when the markets actually took note – but these days the credit agencies seem to carry zero credentials or kudos. Their triple AAA ratings on financial products in the lehman days will haunt them for eternity.
On the stimulus front – the FED Reserve kick started the ‘twist’ measures will will please the markets but many were hoping for stronger action. That’s not to say that QE3 is still not on the cards – very much so, just not quite yet. The US appears to be waiting for Merkel and co to define their strategy for the EuroZone before flooding the markets with new cash.
The Eurozone leaders are expected to reveal a massive bail out fund for Italy and Spain which once finalised should see the markets trade with less uncertainty until the next hurdle arises. With US elections set for Nov 2012, Obama will be keen to see recovery shoots and buoyant markets.
The DOW closed the week 25 at 12640 down 167. The FTSE 100 finished the week at 5511 up 32pts.
A virtual portfolio has been set up using the 2011 final trading day close figures as a starting point and £1000 has been invested in each stock. This does not include buying fees or stamp duty and is purely intended to be used as a benchmark or summary for each week. 2 newspaper top tens for 2012 have been included to help monitor/compare against.
Week 25 stock picks summary:
A tricky week for investors as the AIM E&P’s continue to struggle to gain traction in an uncertain / risk off market. CHAR bounced strongly to deliver a 50% rise in a week from 71p lows to test 106.4p. The rise was off the back of a Goldman Sachs broker note and demonstrates just how confused the market is over valuation and pricing at present. Understandably – CHAR has pulled back to lower 90′s as traders/investors book profits. The biggest casualty of the week was MXP. A double whammy of poor news sent investors heads spinning. Delays on NUR-1 drill has generated uncertainty over future funding on the second deep prospect and the RNS was poorly worded leaving many scratching their heads. The stock had hit the news the week prior after the stock dropped from 10p to test 8p without any known reason.
A week later – the reason became public. The FSA might want to look into the prior weeks trading as clearly the dip appears to have had some insider dealing.
The Independent 2012 list continues to do well and if used as a barometer to the greater markets – most would look in and think that 2012 has been a bumper year – problems? What problems? Looking at the AIM index – the message would be loud and clear – 2012 gains have been erased and most stocks are back to or below their levels seen this time last year. Progress? What progress!
The Tempus times list hangs onto blue ground while the B-list overtakes the Hotlist for the first time this year. The latter clearly bruised from MXP’s 50%+ decline on Friday.
Current standings / Week 25 Results
1. The Independent 2012 +25.13% (weekly gain of 1.83%)
2. Tempus Times 2012 +0.17% (weekly loss of 0.56%)
3. The ‘B’ List 2012 -2.79% (weekly gain of +1.13%)
4. The 2012 Hotlist -5.56% (weekly loss of -7.32%)