This is in no small part thanks to the slow and steady increases in the price of oil. In fact, April 2016 was the biggest monthly rise the oil market has seen in seven years and the average price is now considerably higher than its mid-February lows.
This helped the FTSE all share because oil and commodities dominate the index, together with financials, which also had a good run.
Things weren’t as rosy in the technology and Asia markets. The technology market wasn’t helped by some poor performance reports from the likes of Apple and Twitter amongst others.
Past performance is not a reliable indicator of future results
Source: Morningstar Direct as at 30th April 2016. Total returns in GBP.
Going against the grain is the way to go
Anyone who read our Spring Investment Outlook last month will know that we called out contrarian investing as an area of opportunity.
Value, which was one of our contrarian themes, outperformed growth when looking at some of the funds (Investec UK Special Sits and Veritas Global Income are worthy of mention).
Markets responding to big macro events
Speaking about the performance of the markets, Michelle McGrade, Chief Investment Officer at TD Direct Investing, said:
“Markets were responding to general market sentiment on big macro factors such as the oil price, US companies’ reporting season and global growth prospects, and were not focused on the EU Referendum. So overall the main markets trended higher (in local currency).
“There was, however, a general feeling of disappointment in the US where tech stocks financial reports weren’t great – namely Apple, Twitter and Microsoft. The exceptions being Amazon and Facebook.”
Will the saying be true “sell in May and go away”? With the EU Referendum vote on the 23 June it may be different this time.
Find more contrarian opportunities in our Investment Outlook.
Or, if you’re interested in oil and energy funds, visit our Fund Selector and search under Energy in the Industry Sector tab.
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