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The primary rule of predicting a inventory market crash is rarely, ever predict a inventory market crash. Why? As a result of they’re totally unpredictable.
Because the world faces the largest power shock in its historical past, I’d have anticipated world share costs to have gone into meltdown weeks in the past. However they haven’t. So why are the FTSE 100 and different indexes holding agency?
Share costs have definitely been unstable. However the UK’s blue-chip index continues to be up 3.75% thus far this yr, and 20% over 12 months. I feel that’s fairly stable, given the size of the risk.
So why haven’t share costs tumbled?
Just some months in the past, oil traded at round $60. At this time, a barrel of Brent crude prices $107. Previously, dramatic shifts like which have triggered recessions and worse. But each time markets dip, they shortly get well. Buyers have proven their resilience currently, shrugging off Covid, Ukraine, US tariffs and now warfare in Iran. They’re holding the road right this moment even with the essential Strait of Hormuz oil provide route nonetheless closed.
To this point, we’ve averted oil shortages within the West, by drawing down inventories and strategic reserves. However we will’t do that eternally. If provide tightens, the market crash might nonetheless come, and I’ll be watching carefully, ready for a shopping for alternative. However there’s one factor traders can do right this moment.
And that’s to scour the FTSE 100 for prime UK shares which have taken a beating currently, and supply decrease valuations and better yields consequently. These 5 have been hit laborious over the past three months.
| Inventory | 3 months | 1 yr | 5 years |
| Babcock | -27.6% | 21.3% | 243.5% |
| Weir Group | -28.2% | 1.5% | 28.9% |
| 3i Group | -28.4% | -41.4% | 100.3% |
| Reckitt | -28.5% | -5.3% | -26.9% |
| Barratt Redrow | -34.6% | -45.2% | -66.5% |
I’ll be exploring all of those alternatives within the days forward however proper now I’m notably intrigued by 3i Group (LSE: III) as a result of I maintain it. In truth, till just lately, it was a portfolio star, having doubled my cash in simply over two years.
Can this FTSE 100 inventory make a stellar restoration?
3i is a personal fairness specialist with a monitor file relationship again to 1946. These days, it’s been the automobile for a single staggeringly profitable holding, European non-food low cost retailer Motion. The chain now boasts greater than 3,300 shops throughout Europe, attracting 2.6m prospects each week.
Motion’s gross sales grew one other 16.1% to €16bn in 2025 however traders had been beginning to get nervous even earlier than current geopolitical uncertainty, fearing it will battle to take care of its breakneck development. Buyers had been in two minds over plans to maneuver into the US, a famously powerful market to crack.
However right here’s why I’m highlighting it now. Earlier than the sell-off, the funding belief was buying and selling at a large premium of 29% to underlying internet asset worth. At this time, traders should buy it at a 15% low cost. Additionally, the dividend yield has crept above 3%. 3i administrators have been pouring their very own cash into the inventory. I’ve taken benefit of current dips too.
If markets do crash, 3i Group shares might fall even additional, however I feel they’re properly value contemplating right this moment. Let’s see what summer season brings. Will you be becoming a member of me in monitoring 3i’s progress?
