What a stonking start to the year for tech! NASDAQ up 8%, TechMark 100 up 5.3% and FTSE SCS – the index that most closely tracks the UK SITS - is up 6%. Sure, the FTSE100 was up 2% too, but you have to go quite a way back to find a January quite so good for tech.
Although there is a general feeling that the euro crisis might get fixed – at least ‘for now – this really doesn’t fully explain the bounce. Indeed, as you will see below, the reasons for individual share price increases are both varied and complex
Mouchel, after month after month holding our ‘Wooden Spoon’, got the winners medal with a 45% increase. This was pure bounce as, at 7.7p, they are still very much underwater. See Mouchel at turnaround staring position. The same ‘recovery’ applies at Tribal which rose 44% this month. See Tribal positive end to difficult year. Then, bid speculation affected companies like Misys (up 39%) This was despite something of a ‘warning’ and not particularly brilliant H1 results. See Misys acts to cut costs as market deteriorates. Sanderson rose 39% as its sold its RBS unit to Torex; going from ‘heavily indebted’ to ‘cash positive’ in one move! RM was up 33%. We’d like to call it the ‘Martyn Ratcliffe effect’ but very thin trading volumes played a part too. Last October Ratcliffe was offered an share option deal at 51p provided the share price rose to 100p. This month it closed at 78p – so over halfway there!. See Ratcliffe puts more skin in RM’s game.
There are just too many ‘double digit’ risers this month to comment on them all. Amongst the ‘Big Boys’, Logica recovered by 23% - See Logica confronts the inevitable. And Capgemini was up 16%.
Apple’s ‘Stunning results’ powered them up another 13% to an all-time high and the mantle ‘as the USA’s most valuable company’.
With the vast majority of SITS stocks posting increases in January (who said “A rising tide lifts all ships” didn’t apply anymore?) it seems churlish to highlight the few fallers. But Triad got the Wooden Spoon this month with a 31% decline. One day we’ll write a good news story - or will that be an obituary? – on Triad. But don’t hold your breath.
The problem with stocks is that they can go down as well as up. I wonder what February will bring?