FTSE 100 shares must be due a bit of relief, mustn’t they? I’ve been looking at what the experts think might happen in 2024.
It’s interesting to see a poll of investors by interactive investor. Nearly half the respondents think the FTSE 100 will finish next year between 7,500 and 8,000 points.
I see a few headlines that suggest the UK stock market could fall in the first half of the year, as the effects of economic slowdown and high interest rates really start to bite.
There’s a general feel that the year will end on a higher note, though.
General optimism
I’m optimistic about 2024. More so than the crowds, it seems. As I write, The Footsie is around the 7,500 level.
Even if it rises all the way to 8,000 points, it’s still only a 6.7% gain. And that’s a bit below the long-term average annual performance. It’s hardly the thing that recoveries are made of.
Still, I hope I’m wrong, and the pessimists are right. It would mean more time to buy great stocks cheaply, and lock in even bigger dividend yields.
Stocks and sectors
But which stocks do the experts thing might shine in 2024?
I’m bullish about the financial sector. Banks, insurers and investment stocks look undervalued to me.
And a few experts are tipping Aviva to come good, as cash flow continues to improve after the firm’s big restructuring in recent years. Is that an indicator for the whole sector?
I think there might still be some bloat in the industry, and investors might wait to see how cost control goes. But it’s one of my top sectors.
Growth to continue?
Over at investing platform IG, I see thoughts turning to momentum growth stocks.
Rolls-Royce Holdings has trebled in the past year, and Marks & Spencer has more than doubled. And sometimes, what goes up does indeed keep going up.
Both of those are only marginally up over five years. So, more to come?
I’m mixed. I feel Rolls might be fully valued for now. But I’m warming towards M&S.
A year for retail?
Fidelity has M&S among its stocks to watch too, and is bullish about a number of retailers — including Tesco and J Sainsbury.
I feel we might need interest rates to come down before folks head back to the high street in big enough numbers.
But there’s growing confidence that could happen before too long into 2024. So it might be a good sector to get back into in the early part of the year.
What should we do?
I love to see the stocks that people, private investors and professionals alike, think will do best in the next year. But it’s only for fun, really.
When it comes down to my actual cash, I’ll carry on doing what I always do.
I’ll put my money into the stocks that I think have the best long-term value. And if they’re ones the crowds don’t like, that’s a bonus. It means I get them even cheaper.
