Best Stocks to Buy – The FTSE’s best and worst performing shares one year on from Covid-19 crash

ext weekend will mark the one-year anniversary of the stock market crash which saw the FTSE 100 plunge from 7,403.92 on 21 February 2020 to a low of 4,993.89 on 23 March 2020. 

Analysts at AJ Bell have crunched the numbers to calculate the best and worst performing stocks on the FTSE since, broken down into pre- and post-vaccine development – the day in November nicknamed Pfizer Monday when everything changed.

The biggest gainers pre-vaccine include online and value retail shops like AO World and B&M, spread betting service providers and bookmakers, alongside the providers of life’s essentials – especially those with a decent website and the option to deliver to your door.

The biggest faller was retail landlord Hammerson, down 77% in the period, as lockdown sent the high street and almost everything in it over a cliff. Travel firms, cinemas and leisure operators also suffered as the world went into hibernation.

News of a working vaccine, announced by Pfizer on November 9, saw a turnaround in the markets with those leisure and travel stocks such as Cineworld, FirstGroup and SSP leading the way on the back of hopes of a return to normality.

How long they can hold on for remains to be seen – with the threat of looming inflation that could turn everything on its head once again with a rush to commodities, developing markets and gold.

Russ Mould, investment director at AJ Bell,  said:  “It seems remarkable now just how relaxed financial markets were during the early stages of the COVID-19 outbreakbut confidence ebbed rapidly from late February onwards once they grasped the gravity of the situation. 

“Share prices plunged for a month and even though some found their footing, plenty of others in the worst-affected industries just kept falling, in the view that their fortunes may never be the same again.

“Yet the picture has changed again since ‘Pfizer Monday’ in early November. Investors seem more optimistic, perceived pandemic and lockdown winners have begun to lose momentum and potential recovery plays have begun to gain.

“Laggards have included airlines, retail store landlords, travel agents, travel companies and bingo hall specialists such as easyJet, Hammerson, TUI, Carnival and Rank, all of whom will now be waiting to see when and to what degree demand for their products and services returns even in a post-pandemic world.

 “As is always the way, markets have switched from greed to fear and then from fear to greed. Since 9 November, the combination of vaccines, fiscal stimulus and monetary stimulus has persuaded markets to look on the bright side and go even beyond that, as they contemplate whether inflation is about to make an unexpected return to the financial stage.

 “If inflation does appear, after 40 years of disinflation, low inflation and even fears of deflation, it would be the ultimate game-changer.

“Everything that has worked for investors, brokers and fund managers over the last four decades in a low inflation world – long-duration assets such as bonds, technology and biotechnology equities and secular ‘growth’ stocks – would struggle in this completely new environment, at least if history is any guide.

“Instead, investors might start to look toward cyclical growth (or ‘value’ for want of a better name), emerging markets and commodities and ‘real’ assets, to capitalise upon an economic upturn and inflation’s erosion of debt in real terms. They might also seek protection from higher bond yields and higher interest rates, as well as the erosion of the purchasing power of cash  – a theme to which advocates of gold and Bitcoin will readily warm.”