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Highlights:
- FTSE 100 gains 5.3% in 2024: Rolls-Royce Holdings and International Consolidated Airlines Group topped the blue-chip index, each rising 93.9%.
- FTSE 350 winners led by CMC Markets: The trading platform surged 140%, followed by Metro Bank and Trustpilot with respective gains of 138% and 122%.
- Retailers dominate FTSE 350’s losers: Ocado Group and B&M European Value Retail fell sharply, mirroring broader pressures on consumer spending.
Despite facing headwinds early in the year, the London stock market ended 2024 on a high note, with both the FTSE 100 and FTSE 350 posting positive annual performances. The FTSE 100 rose 5.3%, buoyed by a resurgence in the aviation and defense sectors, while the FTSE 350 followed closely behind, highlighting strong performances across various mid-cap stocks. However, not all sectors thrived, as retailers and pandemic-era favorites faced steep declines.
FTSE 100’s Top Performers: Rolls-Royce and IAG Soar
Rolls-Royce Holdings:
Rolls-Royce emerged as one of the standout performers for the year, with its share price climbing 93.9%. This followed an impressive 197% surge in 2023 under the leadership of CEO Tufan Erginbilgic, who has spearheaded a turnaround strategy emphasizing cost reduction and operational simplification. Increased defense demand and a recovering aviation industry provided additional tailwinds for the engine maker.
International Consolidated Airlines Group (IAG):
Matching Rolls-Royce’s gains, IAG also rose 93.9%, benefiting from the long-awaited recovery of the long-haul airline sector post-pandemic. The company capitalized on rising passenger demand and operational efficiencies, solidifying its position as one of the FTSE 100’s biggest winners.
NatWest Group:
NatWest delivered an 81% annual gain, driven in part by the government’s divestment of its stake. The Treasury’s sale of shares reduced its ownership below 10% for the first time since the financial crisis, marking a milestone in the bank’s journey back to private ownership.
FTSE 350’s Biggest Winners: Mid-Caps Shine
CMC Markets:
Topping the FTSE 350, CMC Markets surged 140%, bolstered by a strong start to the year with a profit upgrade in January. The trading platform’s cost-cutting measures further boosted investor confidence, making it the index’s best performer.
Metro Bank:
Metro Bank achieved a 138% increase, reflecting its successful turnaround efforts. After securing a £925 million funding package in 2023, the bank is now guiding for a return to profitability, signaling a renewed trajectory for growth.
Trustpilot Group:
Trustpilot posted a 122% gain, supported by its robust interim results in September. The review platform exceeded profit expectations and announced a £20 million buyback, solidifying its position as a mid-cap winner.
FTSE 350’s Struggles: Retailers and Aston Martin Decline
Retail Sector Challenges:
Retailers bore the brunt of consumer spending pressures in 2024. Pandemic-era darlings like Ocado Group and B&M European Value Retail saw their shares fall 57.5% and 34.8%, respectively, as both exited the FTSE 100. JD Sports Fashion was not immune, recording a 40.8% decline.
Aston Martin Lagonda:
Aston Martin’s 51.3% drop was marked by two profit warnings and supply chain challenges that delayed vehicle deliveries. The luxury carmaker struggled to regain investor confidence despite attempts to address operational issues.
John Wood Group:
Leading the year’s declines, John Wood Group fell 61.7% after a tumultuous year that included a failed takeover bid and a substantial interim loss of nearly US$1 billion.
A Year of Transition and Opportunity
The gains in 2024 underscore the resilience of London’s stock market, particularly in sectors like aviation and defense, which have rebounded strongly. While the challenges faced by retailers and select industrials highlight ongoing pressures, the overall market performance points to a cautiously optimistic outlook heading into 2025. As the market adapts to evolving economic dynamics, investors will likely focus on sectors poised for growth and stability.
