Hobson: Buy When the FTSE Dips

THE WEEK: The heavy volatility, with the FTSE 100 hitting a new low for the year below 6,200 points, followed by a surge above 6,500, looks like madness - but creates opportunities

Rodney Hobson 19 December, 2014 | 12:46PM
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December’s stock market trading has had all the wheeler dealing shenanigans of Peckham market, but to borrow a phrase from Del Boy in Only Fools and Horses, you know it makes sense. Well, sort of.

The heavy volatility, with the FTSE 100 hitting a new low for the year below 6,200 points, even lower than the mid-October dip, followed by a surge above 6,500, looks like madness and in some ways it has been. Not a lot has happened to justify such extreme movements.

It is true that oil-related stocks have been battered by the falling crude price but the rest of the economy benefits, especially retailers who see their distribution costs tumbling. With pressure on prices in the shops, that takes a bit of the squeeze out of the equation in the High Street. Yet the whole market fell for six consecutive days in which the Footsie lost more than 400 points.

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Securities Mentioned in Article

Security NamePriceChange (%)Morningstar
Rating
Lloyds Banking Group PLC48.25 GBX2.65Rating

About Author

Rodney Hobson

Rodney Hobson  is a columnist for Morningstar.co.uk and author of several investing books, including The Dividend Investor and How to Build a Share Portfolio.

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