Market Commentary July 2020
04 August 2020
There was no fourth consecutive monthly gain for the FTSE 100 index as its winning streak came to a halt.
Fears of a second wave of COVID-19 being underway in Europe, local lockdowns being imposed and a new two week quarantine requirement on travellers from Spain saw the index retreat by 4.41% for the period.
As diplomatic ties between the United States and China worsened, the value of precious metals rose sharply with the price of gold soaring to an all-time high.
For the month of July the top FTSE 100 rising stocks were;
- Fresnillo PLC +44.05%
- Polymetal International PLC +20.78%
- Next PLC +13.59%
- Hargreaves Lansdown PLC +11.86%
- Antofagasta PLC +11.06%
A combination of surging commodity prices and lower costs, leading to a 56% increase in profitability for the first 6 months of the year, saw shares in precious metal miner Fresnillo rise considerably.
For the month of July the top 5 FTSE 100 falling stocks were;
- International Consolidated Airlines Group S.A. -27.33%
- Melrose Industries PLC -27.13%
- Burberry Group PLC -23.39%
- ITV PLC -21.19%
- Informa PLC -19.22%
British Airways and Iberia owner International Consolidated Airlines Group reported a £3.8Bn loss for the first half of the year. Plans to raise £2.75Bn to support it through the crisis weighed heavily on its share price.
In the currency markets, sterling strengthened against the US dollar as the Bank of England repeated its view that the UK economy was undergoing a V shaped recovery. Negative US Federal Reserve data assisted with the upward trajectory.
| 31 July 2020 | 1 month | 6 months | 12 months | 24 months | 36 months | 48 months | 60 months | |
|---|---|---|---|---|---|---|---|---|
| FTSE 100 | 5897.76 | -4.41% | -19.05% | -22.26% | -23.89% | -20.00% | -12.29% | -11.92% |
| GBP/USD | 1.3090 | 5.56% | -0.84% | 7.66% | -0.28% | -0.94% | -1.07% | -16.22% |
| GBP/EUR | 1.1108 | 0.64% | -6.65% | 1.18% | -1.06% | -0.46% | -6.15% | -21.88% |
This newsletter is intended to provide a general review of certain topics and its purpose is to inform but NOT to recommend or support any specific investment or course of action.
Figures refer to the past and past performance is not a reliable indicator of future results. You may not get back the full amount of your investment.
Sources of information as at close of business 31st July 2020:
FTSE 100: www.investing.com
Currency: www.investing.com
FTSE 100 Risers & Fallers: www.sharesmagazine.co.uk
Inflation & Interest rates: www.bankofengland.co.uk
