A FTSE 100 stock up 110% and the small-cap share up 750%

by Graeme Evans from interactive investor |

Stock markets remain hugely volatile, demonstrated clearly by stunning recoveries at these two firms. 

The best two days in FTSE 100 index history were followed by the inevitable hangover today as some familiar stocks from the market crash returned to the top of the fallers board.

Cruise ship giant Carnival (LSE:CCL), which doubled in value this week amid optimism over America's US$2 trillion stimulus package, continues to see its shares fluctuate wildly as investors struggle to put a price on Covid-19 disruption. It was down 8% at just above £10 today the, after Wall Street opened, the shares rallied 13% to a two-week high at 1,270p.

Last year's FTSE 100 high flyer JD Sports Fashion (LSE:JD.) also fell back 8% to surrender some of this week's gains, having been one of the biggest casualties of the market sell-off due to the impact of the pandemic on its network of stores in the UK, Europe and the United States. But, Like Carnival and many other big names, its shares clawed back lost ground in early afternoon trade.

The pain of individual retail businesses is magnified in the property sector, where shopping centre landlords including British Land (LSE:BLND) and Intu Properties (LSE:INTU) are coming to terms with a slump in rental income. British Land, for example, said that only 12% of its retail units were currently open following the Government's order to close all but essential shops.

Source: TradingView Past performance is not a guide to future performance

Yesterday was March “quarter day” in the retail sector, with Intu reporting that it had only received 29% of rent due. This compared with 77% for the equivalent day a year ago.

The company, whose portfolio includes Manchester's Arndale centre and Lakeside in Essex, said the reduced rents received meant it was likely to seek covenant waivers from lenders. It is also in discussions with the Government and may access its £330 billion support package.

Intu shares fell 4% to below 4p, having been above 100p a year ago. British Land fell 7% to 340p after it said it would suspend dividend payments. The company, which has about 40% of its portfolio in retail, said it was prepared to defer the March quarter day rents and spread repayment over the six quarters from September.

Shares in Land Securities, whose portfolio includes a 30% stake in the Bluewater shopping centre, were also down 7% today. Like British Land, it has fallen more than 40% so far this year.

One of the retail chains forced to temporarily close stores in shopping centres and on the high street has been Dixons Carphone (LSE:DC.)

This comes after huge demand for laptops and printers for home working, as well as for home entertainment and household appliances ahead of the Covid-19 lock-down, helped electricals like-for-like sales jump 35% in the last three weeks.

Dixons said today that the loss of sales in the UK and Greece was likely to be in the region of £400 million over the final month of its financial year, although some of this will be recouped online. It no longer expects to meet guidance for adjusted profits of £210 million or for net debt to be lower year-on-year.

Dixons has already paid its £26 million interim dividend and said it would review whether it is still prudent to pay September's final dividend. Shares were 6% higher at 86p.

In a measure of the market's recent slide, the latest round of dividend cancellations or suspensions were met today with only modest movements in share prices. Engineering group Weir Group (LSE:WEIR), for example, was down just 1% at 728.8p after withdrawing its 2019 dividend.

The company also scrapped last month's guidance on 2020 trading due to uncertainty in its markets, including in oil and gas after a significant slide in commodity prices. This has led to reductions in exploration and production capex, along with a slowing in North American orders.

Daily Mail and General Trust (LSE:DMGT) is one of 11 stocks in the UK that analysts at Morgan Stanley think won't have to cut its dividend. The newspaper publisher and events business reinforced this message today when it reported in-line trading in the five months to February 29.

With more than £700 million of cash and bank facilities available, CEO Paul Zwillenberg expressed confidence in DMGT's ability to withstand the global economic uncertainty and for it to continue investing through the cycle. Shares were little changed at 654p today, having rallied from 550p last week.

That's put in the shade, however, by the spectacular recovery seen at gaming business Gfinity (LSE:GFIN).

Its shares, up as much as 40% today to 2.6p, have jumped as much as 750% since last Friday’s low at 0.3p after the company was selected to deliver the new F1 Esports Virtual Grand Prix series. 

The races will enable fans to continue watching Formula 1 races virtually after Covid-19 forced the cancellation of live Grand Prix events.

Source: TradingView Past performance is not a guide to future performance

These articles are provided for information purposes only.  Occasionally, an opinion about whether to buy or sell a specific investment may be provided by third parties.  The content is not intended to be a personal recommendation to buy or sell any financial instrument or product, or to adopt any investment strategy as it is not provided based on an assessment of your investing knowledge and experience, your financial situation or your investment objectives. The value of your investments, and the income derived from them, may go down as well as up. You may not get back all the money that you invest. The investments referred to in this article may not be suitable for all investors, and if in doubt, an investor should seek advice from a qualified investment adviser.

Full performance can be found on the company or index summary page on the interactive investor website. Simply click on the company's or index name highlighted in the article.

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