The heavily bruised FTSE 250 led the field +5.3%, swiftly followed by the FTSE All-Share and FTSE AIM index +4.5% and +4.4% respectively.

The index performance was mainly led by better than expected results from Retailers, Household Goods and Travel & Leisure businesses. The supermarkets reported bumper sales over the Christmas period, in particular Sainsburys, whilst both Next and JD Sports Fashion comfortably beat analysts’ expectations. JD Sports and their new CEO, Regis Schultz, expanded on the company’s future with a Capital markets day in early February, outlining an ambitious five year strategy to boost revenue, market share in Europe and North American and operating margins by double digits. This was further well received by the market, and the shares have doubled since the October lows.

The oil majors, Shell and BP, both reported historic, all-time results. Shell’s profit more than doubled to $42bn and BP’s new record profits being enough to pay UK household energy bills for a third of the population.  The moral argument behind the justification of these profits on the back of high oil and natural gas prices, partly caused by the war in Ukraine, is as contentious as it is dubious.

As has been customary recently, macroeconomics have dominated the press over the past few months and over January the green shoots of a slowdown in inflation started to appear. The US led the charge, whilst in the UK inflation dropped to 10.5% in December (down from 10.7% in November) with core inflation (minus food and energy) at 6.3%.  In the US the Fed hiked by 25bps and in the UK by 50bps, to 4%, indicating “the first signs that inflation has turned the corner” resulting in rates potentially being close to their peak.

The above article has been prepared for investment professionals. Any other readers should note this content does not constitute advice or a solicitation to buy, sell, or hold any investment. We strongly recommend speaking to an investment adviser before taking any action based on the information contained in this article.

Please also note the value of investments and the income you get from them may fall as well as rise, and there is no certainty that you will get back the amount of your original investment. You should also be aware that past performance may not be a reliable guide to future performance.