Market Commentary November 2020
02 December 2020
As the Coronavirus Pandemic took hold throughout October, a second national lockdown was announced for England for most of November and into December, adding to the fear of investors.
With England locked down again, there became some cause for optimism as three potential vaccines were announced throughout the month. This positive news around the Coronavirus pandemic, combined with the election of Biden as US President caused the main index to close the month up more than 14%.
For the month of November the top 5 FTSE 100 rising stocks were;
- International Consolidated Airlines Group SA 61.50%
- RSA Insurance Group 59.40%
- Rolls-Royce Holdings 48.84%
- Taylor Wimpey 45.23%
- Whitbread 41.97%
Over November, the potential vaccines being announced created optimism about future air travel. This caused International Consolidated Airlines Group’s share price to rise by over 60% over the past month. The downturn they have experienced has also caused them to rethink their business model, one example being the retirement of Boeing 747s by British Airways. By using more modern planes, these are expected to be more fuel efficient as well as making improvements to passenger experience and safety measures.
For the month of November the top 5 FTSE 100 falling stocks were;
- Aveva Group -21.45%
- Fresnillo -8.60%
- Just Eat Takeaway.Com -7.14%
- National Grid -6.51%
- Halma -6.42%
At the start of November the Aveva Group announced a £2.84 billion rights issue in order to fund its takeover of OSIsoft. The issue of over 125 million new shares diluted the value of each existing holding and on the 25 November, when these new shares officially started trading, the price plummeted 20%.
Throughout November, Sterling continued to be relatively stable against the US Dollar and the Euro.
| 30 November 2020 | 1 month | 6 months | 12 months | 24 months | 36 months | 48 months | 60 months | |
|---|---|---|---|---|---|---|---|---|
| FTSE 100 | 6,266.19 | 12.35% | 3.12% | -14.71% | -10.23% | -14.47% | -7.63% | -1.41% |
| GBP/USD | 1.3321 | 2.94% | 7.91% | 3.00% | 4.47% | -1.52% | 6.53% | -11.53% |
| GBP/EUR | 1.1164 | 0.51% | 0.37% | -4.91% | -0.97% | -1.75% | -5.48% | -21.67% |
For more insight into the investment outlook for the months ahead, you can watch BMO Global Asset Management's update on their forecast of the world economy, stock markets and the impact of the COVID-19 pandemic here.
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 October 2020:
FTSE 100: www.investing.com
Currency: www.investing.com
FTSE 100 Risers & Fallers: www.investing.thisismoney.co.uk
Inflation & Interest rates: www.bankofengland.co.uk
