DETAILED BREAKDOWN OF THE PERFORMANCE OF SHARE RECOMMENDATIONS FOR 2022
26 Nov 2021 to 16 Dec 2022
Irish Shares
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Kerry Group -15.5% (Sale recommended on 25 Oct '22); Greencoat +6.5%; Glanbia -4%; Grafton Group -42.4% (Sale recommended on 25 Oct '22); CRH -22%; AIB +74%; Aryzta +6.4%; Bank of Ireland +45%; Permanent TSB +11%; Datalex -36%.
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Average Gain: +2.3%
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ISEQ: -9.6%
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Comment:-
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The early chart indicators of a breakout by the bank stocks from their downward trend, was spectacularly successful in predicting their sudden rise. The major drag on the performance was Grafton Group. The sharp rise in interest rates, to combat inflation (caused by the rise in oil prices as a result of the war in Ukraine), hit all construction stocks very hard. Conversely, the sharp rise in interest rates accelerated the recovery trend in bank stocks, providing a wider profit margin between the lending rate and the deposit rate..
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Update:-
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Sell CRH and Datalex, due to underperformance. All others merit a hold as they are outperforming the market.
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S & P 100 Shares
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Walmart -1.5%; Colgate Palmolive +1%; Lockheed Martin +5.2%; Northrop Grumman +14.2%; Union Pacific -16%; Berkshire Hathaway 'B' -5.9%; Procter & Gamble -6.3%; Morgan Stanley -16.6%; Accenture -29%.
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Average Loss: -6.1%
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S & P 100: -19%
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Comment:-
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The defensive nature of most of this selection resulted in outperformance in a bear market.
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Update:-
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Sell Accenture as it is underperforming, probably due to a downturn in IT consulting. Hold the remainder as they are all outperforming to date.
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Euro Stoxx 50 Shares
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Deutsche Borse +16%; Schneider Electric -13.7%; ASML Holdings -24%; L'Oreal -16.4%; Air Liquide -9.76%; Sanofi -12.4%; Essilor Luxxotica -7.6%; Deutsche Post -35.6%; Daimler (named since changed to Mercedes) -11%; Volkswagen -24.4%.
Average Loss: -13.9%
Euro Stoxx: -7%
Comment & Update:-
Hold Deutsche Borse and Essilor Luxottica only. Sell all of the others as they are underperforming the index to varying degrees.
NASDAQ Shares
Adobe -48.9%; Amazon -49.9%; Microsoft -25.8%; Netflix -56.3%; Meta -64%; Microsoft (again) -25.8%; Discovery (name changed to Warner Bros Discovery following merger) -59.8%; Texas Instruments -9.9%; Qualcomm -36.5%.
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Average Loss: -42%
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NASDAQ: -31%
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Comment:-
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The third great bull market in tech stocks (2015 to 2021) has ended. The second one was in 1995 to 2000, and the very first one was back in the 1960's (1966 to 1968). The charts analysis for most of the above stocks done on this website did flag specific price levels that "provided evidence of a change in trend from bullish to bearish" if the stocks were to fall below these levels. Those levels were at much higher share prices than the current share prices, and these stocks fell below these levels earlier in the year, so subscribers did get a warning to get out. However, to ensure a prudent and conservative analysis of performance, and as no explicit sell recommendations were made in the follow up articles in the Market Topics section, I have accounted for these as if no sales have occurred to date.
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Update:-
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Hold Texas Instruments and 50% of Microsoft (to give it an equal weighing), as both of these have outperformed. All of the others have underperformed so sales are recommended. There was a gap of 15 years between the last two tech booms, so we could be waiting another 15 years for the next one. Time to move on to other sectors, unless and until there is a breakout from the downward trend in the chart for the NASDAQ Composite index.
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FTSE 100 Shares
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Admiral -15% (sale recommended on 26 April '22); Rentokil -16%; BT -26.5%; Segro -45.8%; IHG +5%; 3i Group -6%; Croda Int'l -25% (sale recommended on 26 April '22); Halma -19% (sale recommended on 26 April '22); JD Sports Fashion -39.5% (sale recommended on 26 April '22); Spirax Sarco -23.9% (sale recommended on 26 April '22); Anglo American -19%; Auto
Trader -14.9%; SSE -8.7%.
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Average Loss: -19.6%
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FTSE 100: +4%
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Comment:-
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Oil and pharmaceutical stocks form a large part of the FTSE 100 index. The former shot up on the spike in the oil price on Putin's invasion of Ukraine. The latter was coming off the boil post the covid crisis, but got a new lease of life on the rush into defensive stocks, due the associated hike in interest rates which changed the market trend from bullish to bearish. Neither event was foreseeable, in my opinion. The same comment with regard to earlier sell signals flagged on the charts for the NASDAQ shares per above, also applies to these recommendations.
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Update:-
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Hold the best three performers; IHG, 3i Group and SSE. Also hold Anglo American, because the chart remains bullish despite the sharp pull back in the share price. Sell all of the others as they are failing to demonstrate the sort of resilience that becomes evident in quality stocks during a market downturn.