The UK stock market is experiencing a small rally following a stressful past few days. In mid-morning trade the FTSE 100 was trading 0.7% higher at 7,193.

The FTSE 250 index was 1.2% higher at 19,502; and the FTSE AIM All-Share index was up by the same percentage at 1,025.

More brave investors are now looking for opportunities to buy on the market dip.

Let’s now take a look at the best performing stocks on the market this morning across three different market segments, being the FTSE 100 for large caps; the FTSE 250 for mid-caps; and small caps valued at less than £200m.


FTSE 100 web


Insurers, oil producers and asset managers are leading the charge among FTSE 100 stocks.

Investment trust Scottish Mortgage (SML) rises 6% to 447.4. Its large positions in US-listed stocks Amazon and Tesla meant the investment trust was caught up in the US markets sell-off which began last Friday.

Life insurers Old Mutual (OML) and Prudential (PRU) advance 4.5% and 1.8% respectively.

Life insurers typically keep a small cash component to meet claims and use their rest of customer premiums to invest in financial markets. Therefore they can display high leverage to the direction of markets.

Oil producers Royal Dutch Shell (RDSB) rises by 1.5% and BP (BP.) is up 1.1%.

Apart from both producing decent financial results over the past week – something that might have been missed by some investors amid the market turmoil – their shares will today be helped by a steady oil price just below $67 per barrel.

Some of the more cyclical stocks are also experiencing a rebound, having been among those worst hit during this week’s market sell-off.

For example, construction equipment firm Ashtead (AHT) advances 1.4% to £20.25 today.

Elsewhere, investors are bidding up prices in FTSE 100 drug companies, aerospace and defence firms and media stocks.


FTSE 250 web


The mid-caps experience a broader recovery on the market today. Investment bank Investec (INVP) is the top riser, up 5.8% to 591.2p.

Another top performer is miner Sirius Minerals (SXX) whose shares advance 3.8% to 22.79p.

Investors appear to be selectively picking stocks rather than flocking to specific parts of the market.

For example, AA (AA.) rises 5.2% to 133.65p with contrarian investors hoping to buy at bargain levels.

Having traded at 272p in April last year, AA’s shares then fell to the 160p level at which they settled for most of the second half of 2017 before a renewed sell-off in early 2018.

There are also examples of investors flocking to more robust businesses, buying on the dips with the likes of industrials firm Coats (COA), up 3.7% to 26.5p; and pork specialist Cranswick (CWK), up 2.6% to £30.06.

Royal Mail’s (RMG) shares were barely affected by this week’s market sell-off and they are back in rally mode, advancing a further 3.1% to 524.2p.

That’s all down to the parcels and letters specialist reaching a deal over pensions and pay, which should hopefully let management refocus on improving operational efficiency and rolling out new technology to automate various tasks.


small cap web


Among the names on AIM rallying hardest is oil services minnow GETECH (GTC:AIM), up more than 20% to 27.5p.

This is possibly a delayed reaction to a positive trading update released amid the growing market turmoil on Monday.

Wireless solutions business Starcom (STAR:AIM) also enjoys a double-digit rise, a performance which is matched by a number of small cap resource plays including Touchstone Exploration (TXP:AIM), UK Oil & Gas (UKOG:AIM), Angus Energy (ANGS:AIM), Anglo Asian Mining (AAZ:AIM) and Beowulf Mining (BEM:AIM).

The inflationary pressures which the markets appear to be reacting to could be positive for miners and oil and gas companies if they result in higher commodity prices.


DISCLAIMER: The author owns shares in Scottish Mortgage

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Issue Date: 07 Feb 2018