Archived article
Please note that tax, investment, pension and ISA rules can change and the information and any views contained in this article may now be inaccurate.
“Investors will be relieved that the markets aren’t tanking for another day. The FTSE 100 is up 0.7% to 7,191 in early trading on Wednesday, although it is impossible to say if the recovery will be sustained for the rest of the week,” says AJ Bell Investment Director Russ Mould.
Rio Tinto
“FTSE 100 miner Rio Tinto is certainly singing the right notes for shareholders, making up for mistakes in the past. It has reported a record $5.2bn dividend, another $1bn share buyback, achieved a big drop in net debt and produced a big rise in underlying earnings.
“That’s certainly a lot better than wasting large amounts of money on expensive and inferior acquisitions, such as it did under previous leadership.
“Natural resources companies learned their lesson when commodity prices crashed four to six years ago, forcing them to pay more attention to how they run operations and spend money.
“The larger companies, in particular, are looking much healthier now they’ve adopted this smarter mentality. They’re reaping the financial rewards as commodity prices strengthen – and Rio Tinto definitely fits into this group on the basis of its full year results.”
Imperial Brands
“Imperial Brands is one of the worst performing FTSE 100 stocks over the past 12 months, down nearly 27% in value.
“The market has been worried about its trading performance, relative lack of presence in some of the next generation product segments and proposals by US regulators to lower the amount of nicotine in cigarettes to non-addictive levels.
“Today it provides a reassuring trading update, saying it is taking market share in certain parts of its business and that it is prioritising e-vapour growth. But will that be enough to stabilise the share price?
“The tobacco industry has historically been popular with investors thanks to its reliable, defensive nature. Increasing regulatory pressures linked to health concerns have shaken up this industry and forced considerable change. Companies have to constantly adapt, suggesting this industry is higher risk than many people might think.”
Scottish Mortgage Investment Trust
“As one of the most popular investment trusts, it isn’t surprising to see Scottish Mortgage top the FTSE 100 leaderboard today as markets start to recover from previous turmoil.
“Investors clearly have it front of mind when looking for sold-off shares to buy as the market recovers.
“Its shares were hard hit thanks in part to having exposure to several big US stocks including Amazon and Tesla.
“The fact it is bouncing back would suggest that investors still have faith in the fund managers to generate decent returns over the long term.”
These articles are for information purposes only and are not a personal recommendation or advice.