This has not been a great year for the FTSE 100. Since 30 December 2022, the index has risen by 1.3%. Adding dividends of around 4% takes this return to 5.3%. Meanwhile, the US S&P 500 index has leapt 20.5%, excluding dividends.
What’s holding back the FTSE 100?
The US stock market has roared ahead because it is dominated by the ‘Magnificent Seven’ mega-cap tech stocks. Meanwhile, the Footsie is packed with old-economy stocks in sectors such as banking and insurance, oil & gas, mining, and telecoms.
Five Footsie flops
Some UK blue-chip stocks have performed particularly badly of late. For example, these five losers have seen their share prices plunge over one month.
1. Entain
Propping up the bottom of the FTSE 100 is betting and gambling group Entain. Shares in the owner of Coral and Ladbrokes have dived by 13.9% in 30 days. Also, they have crashed by 41.9% over one year, but have gained 26.5% over five years.
Having stumbled from one crisis to another, the company recently paid fines and penalties totalling £615m to settle an investigation into bribery in Turkey. For me, this is a huge red flag, so I’m relieved that I don’t own this stock.
2. Anglo American
Multinational miner Anglo American is the world’s leading producer of platinum and also mines copper, diamonds, iron ore, nickel, and steelmaking coal.
In a trading update released on Friday, 8 December, the group unveiled plans to cut costs and boost profits by reducing its mineral production. This crashed the shares by 19% that day, their worst fall since the global financial crisis of 2007-09.
Anglo’s shares are 13.8% lower over one month, dragging them down 41.9% over one year, but are up 7.7% over five years. My wife and I own shares in this Anglo-South African firm, so we share this pain.
3. Diageo
Shares in Diageo — one of the world’s largest suppliers of alcoholic drinks — have lost 13.4% of their value over one month. This leaves them almost a quarter (-24.9%) lower over one year, but just 0.6% down over five years.
I regard this company as a great British business, so I’ve added it to my buy list for 2024. Though sales have slid in Latin America and the Caribbean, I’ve high hopes that management will turn this tanker around.
4. Burberry Group
I dress for comfort, so what I know about fashion could be written on a postage stamp. That said, I know that second-quarter sales growth at luxury brand Burberry Group was weak, rising just 1% on a same-store basis. Demand from China was particularly muted.
This leaves this FTSE 100 stock down 12.9% over one month, 29.9% lower over one year, and 13.3% down over five years. While its products attract premium prices, Burberry shares are sporting discount stickers.
5. Vodafone Group
In 96th place is the stock of telecoms giant Vodafone Group, which has lost 11.6% of its value over one month. What’s more, the shares have dived by 21% over one year and collapsed by 57.8% over five years. Again, as shareholders in this Footsie firm, my wife and I feel this pain.
Finally, all the above figures exclude dividends, which will help to cushion the blow of these steep price falls!
