We are exactly six months into the year, so let's take a look at the winners and losers at the halfway stage.
Despite the roller-coaster ride that the market has given us this year, the FTSE 100 is only 4.2% below its value
at the end of 2008. Closing on Tuesday at 4,249, it has rallied 23% from its low in March, and was up as much as 30% in early May. In a recent article, Bruce Jackson told the story of this rollercoaster ride.
But while the index is close to where it was six months ago, there is a stark division between the winners and the losers.
The winners
| Company | Sector | Price (p) | 6 Mth Chg |
|---|
| Kazakhmys (LSE: KAZ.L - news) (LSE: KAZ) | Mining | 630.0 | 169.8% |
| Fresnillo (LSE: FRES.L - news) (LSE: FRES) | Mining | 520.0 | 136.4% |
| Vedanta Resources (LSE: VED.L - news) (LSE: VED) | Mining | 1,288.0 | 95.5% |
| Petrofac (LSE: PFC.L - news) (LSE: PFC) | Oil Equip, Srvcs & Distr | 670.0 | 94.6% |
| Eurasian Nat Res (LSE: ENRC) | Mining | 654.5 | 92.9% |
| Barclays (LSE: BARC.L - news) (LSE: BARC) | Banks | 283.0 | 89.9% |
| Xstrata (LSE: XTA.L - news) (LSE: XTA) | Mining | 657.3 | 81.4% |
| Rio Tinto (LSE: RIO.L - news) (LSE: RIO) | Mining | 2,105.0 | 76.0% |
| ICAP (LSE: IAP.L - news) (LSE: IAP) | General Financial | 451.0 | 57.0% |
| Autonomy (LSE: AU) | Software (Frankfurt: A0XFVC - news) & Computer Srvcs | 1,437.0 | 51.3% |
Seven of the top ten shares in the FTSE 100 are in resource sectors, with six of them miners. Top of the list is
Kazakhmys (LSE: KAZ), up 170% on the back of strongly recovering copper prices, which were in turn driven by stock-building in China.The only other FTSE constituent to more than double is silver and gold miner
Fresnillo (LSE: FRES), which gained 136%, but Indian-based miner
Vedanta Resources (LSE: VED) also came close to doubling in price.
Barclays (LSE: BARC) was the only bank in the top ten, up 90% from the start of the year, but we shouldn't forget that it has risen five-fold from the depths of the gloom in the first quarter.
The losers| Company | Sector | Price (p) | 6 Mth Chg |
|---|
| Land Securities (LSE: LAND.L - news) (LSE: LAND) | Real Estate | 471.3 | -42.8% |
| British Airways (LSE: BAY.L - news) (LSE: BAY) | Travel & Leisure | 124.7 | -29.8% |
| Wolseley (LSE: WOS.L - news) (LSE: WOS) | Construction & Materials | 1,158.0 | -27.4% |
| BT Group (LSE: BT-A.L - news) (LSE: BT-A) | Fixed Line Telecoms | 101.5 | -26.0% |
| Lloyds Banking (LSE: LLOY.L - news) (LSE: LLOY) | Banks | 69.9 | -25.8% |
| Legal & General (LSE: LGEN.L - news) (LSE: LGEN) | Life Insurance (LINS.PK - news) | 56.8 | -24.3% |
| Friends Provident (LSE: FP) | Life Insurance | 65.6 | -23.0% |
| Smiths Group (LSE: SMIN.L - news) (LSE: SMIN) | General Industrials | 701.5 | -22.5% |
| Drax Group (LSE: DRX.L - news) (LSE: DRX) | Electricity | 439.0 | -21.2% |
| National Grid (LSE: NG.L - news) (LSE: NG) | Gas, Water & Multiutilities | 547.5 | -19.8% |
Losing nearly 43% of its value, Land Securities (LSE: LAND) was the worst performer of the bunch, year to date, and a massive rights issue was needed to shore up its balance sheet as a result of sliding commercial property values.
Plumbing and building materials group Wolseley (LSE: WOS) was ejected from the large cap index in March, only to re-enter in June, but is still down 27% this year. Electricity producer Drax (LSE: DRX) was relegated in latest reshuffle, and is now down 21% since January. Four other companies that started the year in the FTSE 100 have also been dropped, following less severe falls in their prices: First Group (LSE: FGP), Tate & Lyle (LSE: TATE.L - news) (LSE: TATE), Amlin (LSE: AML.L - news) (LSE: AML), and Whitbread (LSE: WTB.L - news) (LSE: WTB).
What are the lessons?
Very noticeably, the only sector to be represented in both the winners and the losers is banking, with one constituent in each list (although for simplicity, in the above table I've assumed that we didn't take up the recent open offer for Lloyds' shares). Miners are the clear winners, and the sector as a whole is up 33%.
This seems to support Ken Fisher's assertion that picking the right sectors is more important than picking the right companies within the sector. Easier said than done, of course. Dedicated stock-pickers will doubtless point to the rewards of finding the right company, while others will see this data as an argument for buying trackers, or for staying out of the market altogether. The choice is yours.
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