Resilient stocks in volatile times

Retail stockbroker, The Share Centre is encouraging investors to remain positive about the recent market fluctuations, and is reminding them of the buying opportunities that can be unearthed during these volatile times.

Commenting on the effect the recent volatility, Nick Raynor, Investment Adviser for The Share Centre said: “The yo-yoing markets, coupled with problems and scandals in the banking sector have done nothing to help reassure people about the markets or investing at present. Although the markets are likely to stay volatile and further falls should not be ruled out, there are sectors which appear to have weathered the storm and there are still plenty of opportunities to pick up top quality stocks”.

Raynor highlights the top five sectors that have withstood the recent market downturn and those which are likely to offer value for investors:

Gold

Gold has been, and remains a corner stone of the financial industry. Recently gold and some gold stocks such as Rangold Resources (RRS) have performed well for investors. Those looking to invest can benefit from purchasing gold as an Exchange-Traded Commodity (ETC).

Utilities

In times of uncertainty investors should look for stocks that offer a strong and consistent yield, such as utilities. Pennon Group, one of The Share Centre’s tips for 2008, is performing well and its recent bid for Kelda has highlighted the sector’s attraction as a target for infrastructure funds.

Property

This sector has enjoyed a good start to 2008. Property stocks took a battering last year because rising interest rates reduced the attractiveness of property yields; also it was an unloved sector. As a consequence they remained undervalued at the end of 2007. With prices now starting to rise, as people begin to realise the potential value of these stocks, new property funds are being created to take advantage of these opportunities. Property stocks such as Land Securities and British Land remain favourites of The Share Centre.

Pharmaceuticals

Traditionally a defensive sector, pharmaceuticals have remained strong. Recent rumours about consolidation within the sector, GlaxoSmithkline buying AstraZeneca, have also helped to fuel prices. They are a good buy for longevity.

Retail

Although the retail sector can be unpredictable, certain stocks such as HMV and Morrisons have faired well over the Christmas period. HMV has benefited from refitting some of its stores and they appear to be doing well with their online sales. A particularly successful festive season saw Morrisons claw back some market share from supermarket giants Tesco and Sainsbury.