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End of year stock market review



Seagull58

Seagull58

In the Algarve
Jan 31, 2012
7,246
Vilamoura, Portugal
In the hysteria following the BREXIT vote there was much wailing and gnashing of teeth about how the FTSE was going to crash by year end. One esteemed poster said the FTSE 100 would be down 1000 points on its 23rd June closing price and the FTSE 250 would be down even more. Another said his pension would be destroyed within weeks and he would be living in poverty at retirement.
It's reassuring to see that this was all hysterical nonsense fed by Project Fear. The FTSE100 finished the year just off it's all time high (set earlier this week) at 7142.83, a mere 800 points above its June 23rd closing price of 6338.10. The FTSE250 closed at18,077.27, 700 points up on it's June 23rd close of 17,333.51.

Will they show their faces on NSC?
 




TSB

TSB

Captain Hindsight
Jul 7, 2003
17,666
Lansdowne Place, Hove
I said it would be down 1000 points. However, that was when the government said they'd be triggering article 50 this year.
Since then, they postponed the decision, trump won and the courts ruled there had to be a vote on whether to trigger it.

I stand by my thoughts at the time that, once triggered, the market will plummet.

Appreciate being called 'esteemed' though :thumbsup:

...

NB: though I didn't say that the FTSE 250 would be down more, so you may not have been talking about me.
 


Seagull58

Seagull58

In the Algarve
Jan 31, 2012
7,246
Vilamoura, Portugal
TSB said:
I said it would be down 1000 points. However, that was when the government said they'd be triggering article 50 this year.
Since then, they postponed the decision, trump won and the courts ruled there had to be a vote on whether to trigger it.

I stand by my thoughts at the time that, once triggered, the market will plummet.

Appreciate being called 'esteemed' though :thumbsup:

...

NB: though I didn't say that the FTSE 250 would be down more, so you may not have been talking about me.
Click to expand...

Oh yes you did. You said it in the same quote. If there weren't over 2400 posts in the thread I would go and find it. I think it's around posts 220 to 260.
 


Icy Gull

Icy Gull

Back on the rollercoaster
Jul 5, 2003
72,015
Isn't the strong stock exchange due mostly to a weak pound?
 


L

London Irish

Well-known member
Nov 25, 2003
21,867
Trapped inside the Project for the New American Ce
Two points
1 the FTSE isn't usefully measured in local currency terms - its dollar performance isn't so great
2 a bunch of multinational companies with much of their business abroad isn't a useful proxy for the health of the British economy companies

But carry on
 




TSB

TSB

Captain Hindsight
Jul 7, 2003
17,666
Lansdowne Place, Hove
Seagull58 said:
Oh yes you did. You said it in the same quote. If there weren't over 2400 posts in the thread I would go and find it. I think it's around posts 220 to 260.
Click to expand...

I'm fairly certain I said that the FTSE 250 was dependent on the pound, which has had a nice rally thanks to Donald.
 


H

Half Time Pies

Well-known member
Sep 7, 2003
1,407
Brighton
London Irish said:
Two points
1 the FTSE isn't usefully measured in local currency terms - its dollar performance isn't so great
2 a bunch of multinational companies with much of their business abroad isn't a useful proxy for the health of the British economy companies

But carry on
Click to expand...

3 Don't forget the lowering of interest rates and another round of QE that the Bank of England felt that they had to do to prop things up, actions which are guaranteed to raise asset prices as they have done in the past.
 


Jim in the West

Jim in the West

Well-known member
NSC Patron
Sep 13, 2003
4,562
Way out West
London Irish said:
Two points
1 the FTSE isn't usefully measured in local currency terms - its dollar performance isn't so great
2 a bunch of multinational companies with much of their business abroad isn't a useful proxy for the health of the British economy companies

But carry on
Click to expand...

Plus, it's weighted by market cap - hence share price movements by the largest companies have a disproportionate impact. The index is categorically NOT an indicator of the health of the UK economy, which is TOTALLY screwed. It wasn't in a great place before the Referendum, and is now in a much worse position (even though we are still in the EU). The only reason things have held up a little since June 23rd is because the British consumer is still borrowing and spending like crazy....it is complete madness. Some time next year the average Joe (or Jo) will wake up and realise the future is rather bleak. I predict this will happen shortly after Queen May has triggered Article 50, and the cold realisation of what we have committed to will gradually sink in. I hope I'm wrong, by the way....
 




oneillco

oneillco

Well-known member
Feb 13, 2013
1,259
Seagull58 said:
In the hysteria following the BREXIT vote there was much wailing and gnashing of teeth about how the FTSE was going to crash by year end. One esteemed poster said the FTSE 100 would be down 1000 points on its 23rd June closing price and the FTSE 250 would be down even more. Another said his pension would be destroyed within weeks and he would be living in poverty at retirement.
It's reassuring to see that this was all hysterical nonsense fed by Project Fear. The FTSE100 finished the year just off it's all time high (set earlier this week) at 7142.83, a mere 800 points above its June 23rd closing price of 6338.10. The FTSE250 closed at18,077.27, 700 points up on it's June 23rd close of 17,333.51.

Will they show their faces on NSC?
Click to expand...

I wouldn't be too smug; the long term economic stability of the UK is the issue, not the short term indicators of an index. Those speculative traders who have pushed the index-up can just as soon dump UK stocks when markets get the jitters about exactly how and who with Britain is going to be trading with in two years time.
 




Seagull58

Seagull58

In the Algarve
Jan 31, 2012
7,246
Vilamoura, Portugal
London Irish said:
Two points
1 the FTSE isn't usefully measured in local currency terms - its dollar performance isn't so great
2 a bunch of multinational companies with much of their business abroad isn't a useful proxy for the health of the British economy companies

But carry on
Click to expand...

But I highlighted the FTSE 250 too, in response to your second point. Regarding your first point, the dollar value of stocks and shares held in the UK and bought and sold in the UK is irrelevant. If your investments are denominated in pounds it is the pound value that matters. Methinks the dollar argument is a remoaner red herring.
 








Seagull58

Seagull58

In the Algarve
Jan 31, 2012
7,246
Vilamoura, Portugal
Jim in the West said:
Plus, it's weighted by market cap - hence share price movements by the largest companies have a disproportionate impact. The index is categorically NOT an indicator of the health of the UK economy, which is TOTALLY screwed. It wasn't in a great place before the Referendum, and is now in a much worse position (even though we are still in the EU). The only reason things have held up a little since June 23rd is because the British consumer is still borrowing and spending like crazy....it is complete madness. Some time next year the average Joe (or Jo) will wake up and realise the future is rather bleak. I predict this will happen shortly after Queen May has triggered Article 50, and the cold realisation of what we have committed to will gradually sink in. I hope I'm wrong, by the way....
Click to expand...

I suspect you will be.
 




Seagull58

Seagull58

In the Algarve
Jan 31, 2012
7,246
Vilamoura, Portugal
Half Time Pies said:
3 Don't forget the lowering of interest rates and another round of QE that the Bank of England felt that they had to do to prop things up, actions which are guaranteed to raise asset prices as they have done in the past.
Click to expand...

Weren't these factors considered when the 1000 points crash by year end was predicted?
 






W

Waynflete

Well-known member
Nov 10, 2009
1,105
Seagull58 said:
But I highlighted the FTSE 250 too, in response to your second point. Regarding your first point, the dollar value of stocks and shares held in the UK and bought and sold in the UK is irrelevant. If your investments are denominated in pounds it is the pound value that matters. Methinks the dollar argument is a remoaner red herring.
Click to expand...

I'm afraid you've fundamentally misunderstood this. Most FTSE 100 companies are international and therefore earn most of their money in currencies other than Sterling.

Because the FTSE values companies in Sterling, if the pound crashes those companies automatically become worth more pounds than before.

That is not an indicator of health, it is an indicator of the weak pound.


Sent from my iPhone using Tapatalk
 






beorhthelm

beorhthelm

A. Virgo, Football Genius
Jul 21, 2003
35,302
London Irish said:
Two points
1 the FTSE isn't usefully measured in local currency terms - its dollar performance isn't so great
2 a bunch of multinational companies with much of their business abroad isn't a useful proxy for the health of the British economy companies

But carry on
Click to expand...
FTSE 250 finishes the year up some 600+ points, and over 3000 points above the kneejerk reaction to Brexit vote. generaly its about 1000 points over the year average. carry on.

Jim in the West said:
Plus, it's weighted by market cap - hence share price movements by the largest companies have a disproportionate impact. The index is categorically NOT an indicator of the health of the UK economy, which is TOTALLY screwed.
Click to expand...

firstly, the OP never claimed or implied it was an indicator of the economy health. secondly, price movements are proportionate to the largest market caps, because thats the point of the index, its weighted so that it represents the value of the shares, not the nominal share prices (i.e. a share priced 150 vs 500 is irrelevant if they move 10 points each, its the relative value that move represents that matters). it would be disproportionate if smaller constituent companies moved the index by the same amount as largest companies.

fact remains, and the point being made, is that thge Brexit vote has not brought about the collapse of the stockmarket as predicted. its no good citing that its due to currency devaluation, as that was also (excessively) predicted, so should have been part of the evaluation of post vote reaction. this only goes to show how project fear made simplistic claims of everything going to shite, which have been proven wrong so far. why cant the remain camp admit they misunderstood the reaction and its not been as expected, and the economy is more robust than they expected? why can they still not make a positive case for remaining, instead of relying on negative economic claims?
 


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