Wow, what a week (and month) it’s been for stocks. After hitting record highs in February, stock markets have plunged on fears of a new trade war. Even after Thursday’s (10 April) big rebound, the FTSE 100 index is down 6.3% in a week and 7.6% over a month. Meanwhile, the US S&P 500 has dropped 0.4% and 6.2% over those periods, respectively.
My family portfolio is heavily weighted to US stocks and UK shares, so it’s taken a few hard knocks. Indeed, some of our holdings have fallen so far and fast, I’ve been baffled by these recent market moves.
My biggest FTSE fallers
Earlier today, I produced a list of the 20 biggest FTSE 100 fallers over the past month. Alas, I found four of my family’s blue-chip holdings in this list of laggards and losers. Here they are (sorted from biggest to smallest price decline over the past month):
| Company | Business | Market value (£bn) | One month | One year | Five years |
| Barclays | Bank | 37.6 | -19.1% | 27.9% | 147.6% |
| BP | Energy | 55.4 | -19.5% | -35.6% | -0.8% |
| Glencore | Miner | 30.2 | -25.4% | -49.6% | 64.6% |
| Anglo American | Miner | 25.5 | -25.9% | -19.5% | 20.7% |
Two of these worst-hit stocks are from the same sector: mining. With Trump’s trade tariffs predicted to cause a global economic slowdown, miners, oil & gas, and banking stocks have all taken a beating. Indeed, the wider list of Footsie losers over one month is dominated by companies in the financial and commodity sectors.
Of course, the reason for the sharp declines in share prices is President Trump’s threat of hefty trade tariffs on imports to the US. Sadly, the US has tried trade/tariff wars of this kind before — most notably in 1828 (the ‘Abomination tariffs’) and 1930 (Smoot-Hawley tariffs). Both contributed to long, deep US recessions, including the Great Depression that began with the Wall Street Crash in October 1929.
And when the American economy sneezes, other countries usually catch cold, which is stoking fears of a potential global recession in 2024/25. Hence the slump in stocks right across the globe, less than two months since stock markets hit record highs.
I like the look of Barclays
As mentioned, my wife and I own all four of the stumbling shares above. I’m wary of buying commodity-related stocks in the current turmoil, so three of these slumpers are not for me right now.
However, I can’t see big British bank Barclays (LSE: BARC) suffering savagely from US trade tariffs. As I write (11 April), the Barclays share price stands at 258.4p, valuing the Blue Eagle bank at £37.1bn. At its one-year high, this stock hit 316p, so it’s fallen steeply from this top.
After this latest setback, this FTSE share trades on a multiple of just 7.4 times earnings, generating an earnings yield of 13.5% a year. Thus, the bank’s dividend yield of 3.3% a year is covered a juicy 4.1 times by trailing earnings. To me, this offers a huge margin of safety, giving confidence that future cash payouts will be similar or even higher.
Then again, nothing is certain in financial markets, including future dividends. Also, if this stock-market swoon continues, Barclays’ investment-banking revenues might plunge. And a UK recession could lift loan losses and bad debts. Even so, I have no intention of selling this FTSE 100 stock at current price levels!
