Market Commentary October 2020


Craig Hendry

Craig Hendry

Managing Director & Chartered Financial Planner


As the number of coronavirus cases mounted throughout October and fears of a second lockdown increased, the main index came under renewed pressure closing the month down nearly 5%. In terms of performance, this was the worst month for the index of the current crisis since markets fell significantly in March of this year.

France and Germany having already announced second national lockdowns and no sign of COVID19 coming under control, added to the fears of investors as October drew to a close.

For the month of October the top 5 FTSE 100 rising stocks were;

  • NatWest Group PLC +13.06%
  • Flutter Entertainment PLC +9.11%
  • Barclays PLC +9.06%
  • Informa PLC +7.98%
  • International Consolidated Airlines Group S.A +5.42%

Shares in NatWest, the banking and finance group made double digit gains as it posted better than expected earnings, turning a profit of £355M during the third quarter of the year. Markets also responded positively to news of the bank only having to set aside half of what analysts expected for bad debts and the announcement that the bank planned to resume paying dividends as soon as possible.

For the month of October the top 5 FTSE 100 falling stocks were;

  • Rolls Royce Holdings PLC -37.22%
  • BAE Systems PLC -19.51%
  • Prudential PLC – 16.42%
  • Hargreaves Lansdown PLC –16.38%
  • Mondi PLC –14.82%

Following the recent Rolls Royce rights issue, the 6.4bn new shares coming on to the market diluted the value of each pre-rights issue share thus pushing the value much lower.

During the month on the currency markets, Sterling remained relatively stable against the US dollar and the Euro.

On the domestic front, it was announced that Britain’s unemployment rate rose to 4.5% in the three months to August, up from 4.1% previously.

 31 October 20201 month6 months12 months24 months36 months48 months60 months
FTSE 1005,577.27-4.92%-5.49%-23.05%-21.76%-25.57%-19.80%-12.32%
GBP/USD1.29410.14%2.76%-0.01%1.37%-2.57%5.69%-16.13%
GBP/EUR1.11070.76%-3.37%-4.29%-1.59%-2.61%-0.39%-20.77%

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.sharesmagazine.co.uk

Inflation & Interest rates: www.bankofengland.co.uk