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It’s been a risky few weeks for the inventory market, due to the conflict in Iran. But the FTSE 100 hasn’t collapsed. There was a correction, a drop of 10%, however no full-blown crash. It’s even clawed a lot of that again.
The blue-chip index closed at 10,667 on Friday (17 April). That’s simply 2.2% under its all-time excessive of 10,910, reached on 27 February, the day earlier than the battle started. That’s a outstanding present of resilience. Can it go ont o break 11,000 from right here?
This has been an odd disaster. We’ve had dire warnings of the most important oil shock in historical past. But buyers have been completely completely happy to take Donald Trump at his phrase that the whole lot’s underneath management.
The FTSE 100 may fly
On Friday, they obtained what they needed. Trump confirmed the Strait of Hormuz is open. The FTSE 100 jumped, whereas the S&P 500 hit a recent document of seven,126 after rising 1.2%. We’ve seen this loads recently. Geopolitical shocks set off a sell-off, then cut price hunters pile in. The Covid hunch in 2020, the Ukraine invasion in 2022 and US tariff threats in 2025 all match that sample.
This confirms our agency view at The Motley Idiot, that promoting in a panic hardly ever pays. As an alternative, buyers ought to grit their enamel, and take the chance to snap up cut-price shares. It isn’t straightforward although, when the headlines scream disaster. Lots can have waited for even decrease costs and missed the bounce.
So what occurs on Monday? The rally may proceed. Or it would properly reverse, following studies that Iranian gunboats are concentrating on delivery within the Strait of Hormuz. Both means, buyers ought to discover loads of cut price shares on the market. To my shock, cigarette maker Imperial Manufacturers (LSE: IMB) is immediately considered one of them.
Imperial Manufacturers shares look good worth
Tobacco shares have been among the many finest FTSE 100 performers of the millennium. That’s extraordinary, given the regular decline in smoking charges throughout the West. Imperial Manufacturers, like FTSE 100 rival British American Tobacco, has used its branding energy to seize an even bigger share of a shrinking market, whereas transferring into options akin to vapes. And it’s stored buyers candy with a gradual stream of rising dividends.
Its shares fell laborious after Tuesday’s underwhelming buying and selling replace. Imperial Manufacturers reported an honest begin to its 2026 monetary 12 months and caught to steering of three%–5% progress in underlying working revenue. But buyers fixated on slippage in its Subsequent Era Merchandise portfolio, and weaker market share in key areas.
That factors to more durable situations forward however the response nonetheless feels harsh. Imperial Manufacturers is the FTSE 100’s greatest faller during the last month, down greater than 13.5%. Over 12 months, it’s slipped 6.5%. That leaves it wanting good worth although.
Imperial Manufacturers now trades on a modest price-to-earnings ratio of 8.86, whereas the yield has crept as much as a juicy 5.77%. Tobacco shares aren’t for everybody, they usually’re underneath fixed regulatory menace. However at this worth, and with that revenue, it nonetheless appears price contemplating.
There’s a lot extra worth left within the FTSE 100 and that’s unlikely to vary. No matter occurs within the subsequent few risky days.
