Equity markets have done well in the first quarter of 2012. The FTSE 100 stood at 5,768 at the end of last week, off its mid-March high of 5,989, but still 3.5% up for the year to date. Three out of every four blue chips are showing gains.
Mid caps and small caps have done even better. The FTSE 250, which consists of the next largest 250 companies after the FTSE 100, and the Small Cap index have both risen by more than 14% since the start of the year.
Big winners and losers
The tables below show the top 10 risers and fallers for each index:
FTSE 100 Gain (%) FTSE 250 Gain (%) FTSE Small Cap Gain (%)
|Royal Bank of Scotland||37.0||C&W Worldwide||109.2||Enterprise Inns||110.7|
|Lloyds Banking||29.7||Ophir Energy||75.7||IP Group||71.3|
|Johnson Matthey||28.5||Int'l Personal Finance||56.3||St Modwen||63.5|
|Legal & General||27.1||Misys||54.1||Thomas Cook||52.5|
|WPP||26.5||Petra Diamonds||52.5||Low & Bonar||52.5|
|Burberry||26.3||Barratt Dev||51.8||Robert Walters||51.2|
Source: Digital Look
FTSE 100 Loss (%) FTSE 250 Loss (%) FTSE Small Cap Loss (%)
|Randgold Resources||18.5||Exillon Energy||32.6||CPP||46.4|
|Royal Dutch Shell||10.4||Homeserve||18.5||Yell||29.3|
|BSkyB||7.7||African Barrick Gold||16.3||Int'l Ferro Metals||14.7|
|Eurasian Nat Res||6.8||C&W Comms||15.5||Fortune Oil||14.6|
Source: Digital Look
Well done, if you're holding any of the big winners! Particular congratulations to Vailima, current leader of the Fool community's annual share competition, with top pick Premier Foods.
There are plenty of interesting stories among the first quarter's risers. Blue-chip car insurer Admiral has bounced back strongly since a profit warning battered its shares last November. An old adage says profit warnings come in threes, but it doesn't always work out that way.
The performances of last year's beaten-down banks RBS, Barclays and Lloyds also catch the eye, as does the performance of online grocer Ocado, whose January trading update reported a surge in sales over the Christmas period.
Shares in Enterprise Inns and Cable & Wireless Worldwide are others that have more than doubled since the start of the year, the latter following news of possible bids by Vodafone and Tata Communications.
However, in looking to the future, and companies that might make rewarding investments now, contrarian value investors are always likely to find more interesting fish swimming in the pool of losers.
Zero to hero contenders
Supermarkets have been decidedly out of favour. Tesco (-18.2%) and Morrison (-8.7%) are among the top 10 blue-chip fallers and Sainsbury has returned a below-index-average gain of 2.8%.
My Foolish colleague Malcolm Wheatley has recently made the bull case for Tesco, following its well-documented recent travails. Backing Britain's biggest supermarket looks as easy as walking through an open door for inveterate contrarians -- which is the one thing that slightly worries me about it!
Big pharma has also been out of favour in the first quarter. The balance of newsflow has tended towards the negative for Shire (-9.9%) and AstraZeneca (-6.6%), putting them among the top 10 blue-chip fallers. Meanwhile, the biggest of the big drugs groups, GlaxoSmithKline, lurks just outside the top 10. Fellow Fool David Holding told us in February why he would add to his holding in AstraZeneca on any further weakness in the shares.
It's notable that, while two broadcasting groups – blue-chip ITV and small-cap UTV – feature among the top risers, BSkyB (-7.7%) continues to suffer from the bad press the Murdoch empire has been getting. Another company currently enduring negative publicity is cruise-ship operator Carnival, which ranks on the cusp of the Footsie fallers list at number 11 (-6.0%). I recently highlighted BSkyB and Carnival as interesting opportunities in our Expert Stock Picks series.
Among the mid caps, transport firm FirstGroup (-29.7%) last week reported weakness in its core UK operations, while PZ Cussons (-14.4%), the maker of Imperial Leather soap and other sudsy personal care and household brands, is suffering as a result of civil unrest in its large Nigeria market. Cussons is a company I've had my own eye on for a long time and I'm monitoring the newsflow closely.
Finally, a big theme across the indices has been the weakness in oil, energy, metals and mining. Around half of the 30 companies in the table of fallers operate in these areas. Oil major Shell (-10.4%) has been a notable first-quarter loser, while Randgold Resources (-18.5%), the heaviest Footsie faller, is just the largest of the gold miners to have suffered from negative sentiment during the period.
To sum up, despite the general buoyancy of the equity markets so far in 2012, a number of industries and individual companies have been thoroughly shunned by the market. As winning in the long run requires running contrary to the herd, investors should be looking for opportunities among these out-of-favour sectors and firms.