Today the FTSE 100 has closed lower by 1%. This follows news that the ECB was moving to reign in on the loose monetary policies of the pandemic period. While it is not expected to raise rates, analysts expect the ECB to halt or slow down the bond-buying frenzy that has become the norm since the pandemic started.
It is also expected that other nations could follow suit. The Bank of England had already indicated earlier that it could raise interest rates at some point in 2022.
While this could mean a slowdown in overall market momentum in the medium term, it doesn’t mean that the opportunity to invest in the markets is gone. The key is to have a long-term view of the market.
When one thinks of the stock market long-term, then pretty much any time is a good time to buy. For instance, anyone who had bought stocks in the early 2000s, and held through the 2008 crisis, went on to make even bigger gains after.
The best part is that one does not need capital to profit from the stock market long term. With just £1,000, one can build a sizeable stock portfolio.
No-Brainer UK Stocks to Invest £1,000 in Right Now
- Argo blockchain
- Flutter
- Antofagasta
- Deliveroo
- DS Smith
1. Argo blockchain
While most LSE stocks have dropped today due to the ECB news, Argo (ARB) has gained. That’s because it is closer to the crypto market than it is to the broader stock market.
This is actually a good thing both in terms of its short-term and long-term projections. Presently, the crypto market is on a rebound, and Bitcoin is inching closer to its all-time highs.
With El Salvador finally moving to actually start use Bitcoin, its demand could shoot up in the short term. Analysts such as Standard Chartered expect Bitcoin to trade anywhere between $100k and $175k in 2021 or early 2022.
If this happens, then Argo, which derives a huge chunk of its revenues from Bitcoin mining, is likely to see a huge boost in revenues. In August, the company gave a business update indicating that it has profited immensely from Bitcoin’s rising prices. Its profit margins from Bitcoin in August were at 86%.
Long term, Argo Blockchain’s prospects look pretty good if Bitcoin’s price projections are anything to go by. That’s because, after every block halving, the supply of Bitcoin slows down relative to its demand.
This has been the key driver to Bitcoin’s price momentum in all its bull cycles. Analysts expect that after the 2024 block halving, its value could go up to $500k or more. For a company like Argo that mines and holds Bitcoin, this would be a huge boost to its intrinsic value.
This makes Argo Blockchain a top UK share to buy now, both for its short-term and long-term price potential. Besides at £137 a share, it is well within reach of anyone who only has £1,000 to put in UK stocks.
2. Flutter
Flutter (FLTR) is another UK stock that makes sense to invest £1000 right now. Flutter’s prospects in short to medium term are likely to get a boost from the return of the European sporting season.
With fans now back in the stadiums, sports betting companies and other sports industry players are likely to boost. This means between now and May 2022, Flutter could experience an increase in revenues.
Sports betting is also gaining momentum in the US too as fans return to NFL stadiums. According to Al Guido, president of the 49ERS, demand is skyrocketing now that live events are back. This too is likely to play into Flutter’s revenues since it has a sizeable share of the US sports betting market.
In the medium term, this company is likely to keep benefiting from its investment in FanDuel. The company bought a majority stake in FanDuel in 2018, and it has paid off immensely as FanDuel’s market share in the US grows.
FanDuel has been performing quite well over the past couple of quarters, and according to its CEO, Amy Howe, will turn a profit in 2023. This is likely to play into Flutter’s value in the long run.
A combination of growing market share and revenues is a good reason to bet on this stock for someone with only £1000 to invest. It has the potential to turn it into a tidy sum.
Flutter is trading at a good entry point too. Over the past week, it has been in a correction but has held steady above the 200-day moving average support at £14,203.06.
If this support holds over the next couple of days, then it could gain upside momentum for the rest of the year. It has a confluence of technical and fundamental factors in its favour.
3. Antofagasta
Commodity stocks are usually at risk of heavy fluctuations due to sudden changes in commodity prices.
While they carry a significantly higher risk than blue chips, they also have the potential to give higher returns than average in boom times.
Antofagasta (ANTO) is a good example of the massive potential that these stocks carry. In the last five years, this stock has given investors a return of over 229%. That’s a healthy return by any standards.
Going into the future, this stock’s prospects look good regardless of how the broader market plays out in the short term.
One of the key factors likely to play into Anto’s stock price in the near term is a possible increase in the price of copper.
Copper mining consumes a lot of water, and at the moment, there is a massive drought in Chile, one of the world’s largest copper mining countries.
Back in August, Antofagasta announced that it expects its output for the year to fall to around 710k to 740k tons. This is lower than its earlier projections of 730k to 760k tons. It attributes this to the drought in Chile. Since it is not the only company affected, the supply of Copper could fall short term and push up prices.
This is happening at a time when the demand for copper and other commodities could rise, now that the world is reopening again.
Long term, Antofagasta is innovating, which is always a good pointer to a good stock to buy. While highlighting the challenge caused by the drought, the company noted that it was in the process of constructing a desalination plant.
The plant is expected to be completed in 2022 and will stabilize the company’s copper output going into the future. A combination of these factors makes Antofagasta one of the best UK shares to invest £1,000 today.
4. Deliveroo
E-commerce has been gaining traction for a couple of years now, but the COVID-19 pandemic has accelerated it.
This is likely to become the norm as more people adapt to working and shopping from home. This presents a huge opportunity for Deliveroo (ROO), a company that has positioned itself in the fast-growing food delivery market.
There are several factors that play into this company’s potential both in the short term and in the long run.
Its strong brand equity has seen it get into partnerships that will help drive up its revenues in the short term. For instance, the company recently got into a partnership with Boots for the deliveries of some medications, among other conveniences.
In the long run, the structural changes in the economy that favour e-commerce are good for ROO. It means the company’s revenues are only set to grow long term. This is a plus to the potential prospects of this stock.
5. DS Smith
Like Deliveroo (ROO), DS Smith (SMDS) has some pretty good prospects going into the future.
Its prospects are driven by the exponential growth of the e-commerce market. Since packaging is an essential part of the e-commerce space, this company is well-positioned for growth in the long run.
Besides the broader market supporting its prospects for growth, this company is actively taking measures that can help it grow going into the future. For instance, it intends to have all its packaging materials made of recycled materials by 2023.
This is a big deal because it aligns the company with the growing calls for sustainable development. This is likely to drive up the demand for its products going into the future.
DS Smith is also a company that offers an element of stability, which is suitable for long-term investors. It has been in operations for decades and has a pretty stable balance sheet.
This company has reliable clients, including Amazon, one of the largest e-commerce companies in the world.
Other than its strong fundamentals, and favourable market conditions, this company is a dividend payer. This means anyone buying into this stock long-term can expect both value appreciation and the passive income that comes with holding a dividend-paying stock.
DS Smith is a stock that makes sense to buy now, for someone who has just £1,000 to spare.
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