Some of Britain's best known companies leave investors nursing losses
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“The FTSE 100 is on track to end the week with zero gains, hovering at the 7560 mark as the summer lull nears its conclusion. It’s a regular-seen scenario of miners trying to lift the index, only to be offset by weakness among tobacco stocks and utilities,” says Russ Mould, Investment Director at AJ Bell.

Some of Britain's best known companies leave investors nursing losses

“Many people suggest anyone interested in the stock market should invest in what and who they know. Yet analysis of the London’s biggest listed companies reveals that many of Britain’s best known names would have been among the worst investments if you picked up their shares at the start of 2018.

“Vodafone, BT, Direct Line, Royal Bank of Scotland, Lloyds and Marks & Spencer are examples of FTSE 100 companies which would have lost money for investors year-to-date.

“These businesses are examples of British corporate success and major employers in the UK, not to mention companies which many of the British public choose to provide goods and services.

“Being a known brand, a large business and a major employer doesn’t always equate to consistent earnings growth and by that very nature a rising share price. Even the greatest can go through spells of tougher times.

“For example, Vodafone has been struggling in various countries including Spain and India. Direct Line has been hit by weaker premiums and intense competition. Lloyds is struggling to win over investors despite a rising dividend as growth in loans and customer deposits have yet to show any real step-change in momentum.

“Some of the best FTSE 100 performers so far this year are companies which are certainly not household names. Steelmaker Evraz (up 43%) reported first-half sales growth in every single one of its geographic regions; and United Arab Emirates-based hospitals group NMC Health (up 31%) is enjoying rapid growth and earlier this week entered the UK market with the acquisition of Aspen Healthcare.”

These articles are for information purposes only and are not a personal recommendation or advice.

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The daily market update is written by Russ Mould, AJ Bell’s Investment Director and his team. The article highlights the movement in the main index, winners and losers on the day and any macro-economic announcements.