Are we in the middle of a new bull market? The weakness in UK share prices in more recent weeks might have prompted much scepticism. But stock market recoveries are never straightforward and a little bit of choppiness is usual as market confidence tentatively recovers.
I’m expecting FTSE 100 shares to start rising in price again before too long as the recovery from Covid-19 continues.
It’s worth remembering that the FTSE 100 has risen a shade under 10% since the start of the 2021. And Britain’s blue-chip share index hit 15-month highs just a couple of weeks ago.
It’s possible UK share prices could slip again as the Covid-19 crisis rolls on and inflationary fears persist. But I’m still looking for great stocks to buy for this new bull market.
A top UK mining share
The Antofagasta (LSE: ANTO) share price has fallen in recent weeks in line with copper prices. In fact, the red metal miner has fallen to 10-week lows.
However, I expect copper values to march back to the record highs hit earlier this month. Metal stocks held at London Metal Exchange inventories remain much lower compared with historical levels as demand has picked up. I’m particularly excited by soaring demand for electric cars and what this will do for copper consumption over the next decade.
Of course UK mining shares like this FTSE 100 operator carry an array of risks. Disappointments on the exploration and production front can be common and can have a significant impact on the bottom line. There’s also the prospect that Chilean mining companies may be forced to pay higher tax bills if legislation on industry royalties passes. All of Antofagasta’s assets are located in Chile.
That said, I still think its shares look mighty attractive at current prices. City analysts think annual earnings here will rise 144% in 2021. This results in a rock-bottom forward price-to-earnings growth (PEG) readout of 0.1. The Antofagasta share carries a mighty 3% dividend yield too.
Another terrific FTSE 100 share
I’d also invest in Prudential (LSE: PRU) to make money from the economic recovery. History shows that spending on life insurance products always rebounds strongly during the early stages of new economic cycles. But this isn’t the only reason why I think this FTSE 100 share will thrive over the next few years. I actually bought ‘The Pru’ for my own Stocks and Shares ISA because of its excellent exposure to emerging markets.
Latest financials from the insurance colossus underlined how lucrative its Asian heartlands are. New business profit here soared 21% in Q1, versus the corresponding 2020 period.
I’m hoping Prudential can make the most of skyrocketing wealth levels in these regions, though rising competition is a problem it will have to overcome. Asia accounted for 10% of global insurance premiums in 2017, versus just 1% at the turn of the century, according to American research group Brookings.