LONDON -- The FTSE 100 smashed through its previous 52-week high to hit 6,172 points on Friday, before falling back a little to end the week at 6,154. That's another half a percent up on the week, and a rise of 4.4% since the start of the year. Stock movements during the week were mostly gains, with few significant falls, and we take a quick look at three big winners and one loser.
Evraz had a very strong week, with its price putting on 23 pence (8.2%) to reach 340 pence. The integrated steel and mining business has been listed in London only since 2011 and for 2012 is expected to record an earnings drop of around 80%! On a P/E of 77 based on that expectation, the stock is clearly priced with the future in mind. And analysts seem to think there are good things to come, forecasting a trebling of earnings for 2013 and a further strong rise for the following year, taking the predicted P/E for 2014 down to 15.
Cruise-line operator Carnival, the owner of the ill-fated Costa Concordia, also enjoyed a good week, seeing its price gain 157 pence (6.5%) to 2,576 pence. That takes its rise over the past 12 months to 30%, as the travel and leisure sector in the U.K. has been recovering well. But the stock is looking pretty fully valued at the moment, with 2013 forecasts putting it at a P/E of 18, quite a bit above the long-term FTSE average of around 14. And the expected dividend yield of around 2.6% is nothing to get excited about.
The Christmas trading period was good for Home Retail, owner of the Argos retail brand that's in the process of transforming from a catalog-based store to a multichannel retailer. For the 18 weeks to Jan. 5, Argos sales reverted from their decline and rose by 1.6%, with like-for-like sales up 2.7%. Internet-based sales are also growing strongly, accounting for 42% of total sales for the year to date. Home Retail also owns the home-improvement chain Homebase, but it's been trouble at Argos that has been the big worry. Still, the latest news boosted the share price nicely, pushing it up 10.7 pence (8.6%) over the week to 134 pence.
The mining sector is about the only one hurting in the U.K. at the moment, with Anglo American leading the falls this week. Despite a recent price turnaround, the stock has been dropping again of late, losing 156 pence (7.6%) to end the week at 1,886 pence. The sector will surely be healthy in the long run, when commodities demand picks up, and Chinese economic growth expectations are starting to improve. But with a forward P/E of over 15, similar to the sector as a whole, there are more attractive-looking investments out there than Anglo American at the moment.
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