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Highlights
- The FTSE 100 was predicted to have one of its best performances in last five years but was hit by fresh Omicron cases.
- In 2021, the heavy industries showed a surge due to pent-up demand during lockdown.
- Investors are predicting further slowdown in the fourth quarter of 2021 and a weak start of 2022.
The FTSE 100 was predicted to have one of its best performances in last five years, but the index was hit by the fresh Omicron cases. The UK economy grew at a slower pace than first estimated between July-September by the Office for National Statistics (ONS) before the Omicron variant started to threaten the recovery again. In the Q3 to September, the UK’s GDP grew by 1.1%, down from an initial estimate of 1.3% as UK emerged from lockdown and global supply chain crisis weighed on various sectors.
The ONS said that the recovery was slower than the economy’s 5.4% growth rate in the second quarter when many restrictions were lifted, and household consumption rose by 2.7%. The UK export fell by 3.5% in the third quarter and the balance of payment deficit widened to £24.4 billion.
Investors are predicting further slowdown in the fourth quarter of 2021 and a weak start of 2022, due to rising cases of Omicron, which is already affecting hospitality, retail, and travel and leisure sectors.
© 2021 Kalkine Media®
Overall blue-chip shares on LSE gained 14.2% this year, outshining the European and US stocks in the same sector. Overall, mining, and industrial stocks were the top performers. Experts said the heavy industries showed a surge due to pent-up demand during lockdown and afterwards when the restrictions were lifted. Energy stocks also performed well after seeing a downturn in the last three years.
In the UK, the Consumer Price Index rose to 5.1%, its highest rate in a decade and up from 4.2% in October. Last month, the Bank of England forecasted inflation to peak at 5%, but not until April 2022 before moderating towards its 2% target in late 2023. Although the prediction for GDP growth in 2022 does not bring any relief, but the figures might change if the government is able to contain the fresh cases of Omicron and the economy starts to recover again.
Also Read: Omicron scare: How are the pub stocks doing?
Here are the five stocks that can do well in 2022.
- Marks & Spencer Group Plc (LON: MKS)
The Marks & Spencer Group Plc is a retail company that specializes in clothing, home and food products and is a constituent of FTSE 250 index. It has given a return of 67.44% to its shareholders in the last one year and its YTD returns stood at 68.91% as of 31 December 2021. Marks & Spencer Group plc’s market cap stood at £4,567.54 million and its shares closed at GBX 231.40 on 31 December 2021.
- AIB Group Plc (LON: AIBG)
AIB Group Plc is a financial services group operating across the UK and Ireland. It has given a return of 8.05% to its shareholders in the last one year and its YTD returns stood at 9.30% as of 31 December 2021. AIB Group plc’s market cap stood at £5,001.25 million and its shares closed at GBX 178.90 on 31 December 2021.
© 2021 Kalkine Media®
Also Read: Energy bills set to rise further: 2 stocks to buy for long term
- C&C Group Plc (LON:CCR)
C&C Group Plc deals in cider, beer, wine & soft drinks and listed on FTSE 250 Index. It has given a return of 0.74% to its shareholders in the last one year and its YTD returns stood at 2.07% as of 31 December 2021. C&C Group plc’s market cap stood at £905.22 million, and its shares closed at GBX 232.20 on 31 December 2021.
- Dechra Pharmaceuticals PLC (LON: DPH)
Dechra Pharmaceuticals Plc is a global specialist veterinary pharmaceuticals and related products business and is a constituent of FTSE 100. It has given a return of 50.25% to its shareholders in the last one year and its YTD returns stood at 54.35% as of 31 December 2021. Its market cap stood at £5,726.10 million, and its shares closed at GBX 5,325.00 on 31 December 2021.
Also Read: 5 undervalued stocks you can keep a tab on in 2022
- Royal Dutch Shell Plc (LON: RDSA)
Royal Dutch Shell Plc is an Anglo-Dutch multinational oil and gas company and is constituent of FTSE 100. It has given a return of 23.11% to its shareholders in the last one year and its YTD returns stood at 24.97% as of 31 December 2021. Its market cap stood at £66,399.07 million and its shares closed at GBX 1,621.80 on 31 December 2021.
