This week’s UK 100 winners (and losers) demonstrate the power of corporate results and major news, blue-chip shares moving anywhere between -11% and +8%. Music to the ears of short-term traders, but equally as enticing for longer-term investors. To make matters even more interesting, the biggest moves were in names perhaps not on your ‘tradar’ (trading radar), highlighting the benefits of broadening your horizons from an often far too narrow selection of household names.

The message from management about profits (or losses) remains important, highlighting how well a company fared in the latest quarter and year. However once again it was made crystal clear that outlook is king, dictating a share price’s fortunes. After all, you can’t buy past performance, you can only trade or invest in future potential.

At the top of the pile this week is newly promoted ConvaTec (Medtech; +11.2%) which rallied into full year results on Thurs, rewarded on the day by a smaller net loss than expected, confirmation of forthcoming dividends and a positive outlook. GKN (Engineer; +8.6%) rallied on Tuesday’s results after a dividend hike and outlook for continued growth and has held onto momentum through today. Croda (Specialty Chemicals; +7.7%) jumped Tuesday after profits were boosted by both acquisitions and organic growth and an outlook suggesting improving sales trends. It also gained again yesterday as the UK Index peaked, and defensives found themselves back in demand.

Other gainers included CRH (Building; +7.3%), which advanced Wednesday on results and US infrastructure stimulus hopes, and Bunzl (Outsourcing; 6%) whose shares started the week strongly courtesy of strong results followed up by a couple of well-received acquisitions.

Now I haven’t even mentioned those whose shares moved south. Capita (Outsourcing; -8.5%) was hurt by falling profits and the CEO’s resignation. WPP (advertising; -6.4%) was victim of a poor 2017 outlook, not far from a profits warning. Direct Line (Insurance; -5.7%) felt the effects of changes to UK personal injury discount rates and precious metals miners Fresnillo (-7.2%) and Randgold Resources (-4.3%) were dragged back by lower Silver and Gold prices as expectations of a US interest rate rise this month saw the USD surge, making the zero-yielding dollar-denominated safe haven commodities more expensive to both buy and hold.

The above list – a not insignificant 10% of the UK 100 – may not include any Banks, Housebuilders, Oil or base metal Miners. However, it does prove that there are other names just as capable of having their day in the sun (or not) and delivering big moves/momentum. At the end of the day a trade is a trade, and if this week’s winners (and losers) offer profitable long (or short) trade opportunities and attractive moves, they are just as worthwhile as the often narrow list of retail investor favourites. In some cases these boring names can offer a less choppy ride as well as helpful income by way of dividends along the way.

And for those of an even more adventurous disposition, what if I told you that  constituents offered ranges of between -14% and +21% this week.

Having read this far (I take it as a complement), know that this style of observation and analysis is what you can expect to receive from us throughout the trading week. It’s  designed to assist you in understanding what the markets are doing and why. Whatever you choose to buy (or sell short), trade or invest, in shares, indices, commodities or currencies, Accendo Markets is here to help you do it.

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As always, have a great weekend!

Mike van Dulken, Head of Research, 3 Mar 2017