“Asda today announced that it will invest over £500 million ($780 million, 600 million euros) in its UK stores and depots in 2012, helping create up to 5,000 new jobs across the country,” the Wal-Mart owned group said.

ASDA

Asda added in a statement that it planned to open 25 new stores and three new depots this year, and would expand and refurbish 43 of its existing outlets.
Cameron welcomed the news, which came after recent data showed that the nation’s jobless total had struck the highest level since 1994 — and could rise further in the coming months.

“The additional investment and 5,000 new jobs announced by Asda today will be a real boost for the economy and more importantly for people around Britain seeking jobs,” Cameron said in the joint statement.

Official data showed last week that a total of 2.68 million people were unemployed in November, up 118,000 from a quarter earlier.

The unemployment rate meanwhile rose to 8.4 percent in the three months to November, the highest level for 17 years.

AFP

Zynga Inc. is the latest in a spate of IPOs by Internet companies this year, ranging from professional networking service LinkedIn Corp. to the online deals site Groupon Inc. They’re all precursors to Facebook’s public debut expected sometime after April next year. Facebook could fetch as much as $10 billion in its offering.

Zynga

Zynga, whose games are played mainly on Facebook, plans to sell its shares at $8.50 to $10 each. If the shares are priced at $10, Zynga will be valued at $7 billion based on the number of its total shares. That’s a smaller valuation that the company’s shares have traded recently on SharesPost, a secondary stock exchange used to trade the stock of privately held companies. There, a recent trade valued Zynga at $11.7 billion.

The company expects to sell 14.3 percent of its available stock, according to a filing with the Securities and Exchange Commission. That’s a relatively high “float,” which could give investors confidence that the company isn’t trying to artificially inflate its value. Groupon raised some concerns when it sold just 5.5 percent of its outstanding stock. Though not unprecedented, the amount was below that of many prominent tech companies, such as Google (7.2 percent), Amazon (12.6 percent) and LinkedIn (8.2 percent).

The offering gives investors the option to buy an additional 15 million shares to cover over-allotments, bringing the total number of shares for sale to 115 million.

Newly-public tech companies aren’t always a hit after their initial offering. Shares of Internet radio company Pandora Media Inc., are trading below their IPO price and Groupon is slightly above and has fluctuated wildly. Unlike those two, however, Zynga is profitable. The company makes most of its revenue by charging small amounts of money for virtual items in its games. Players pay for new crops in “FarmVille,” for example, or new buildings in “CityVille,” its most popular game.

The company plans to use the proceeds from the offering for general corporate purposes such as game development, marketing and other expenses. It also plans to use part of it for its philanthropic venture, Zynga.org.

Zynga has about 2,300 employees. It was founded in 2007 by CEO Mark Pincus. Following the IPO, Pincus will continue to be the sole holder of Zynga’s Class C stock, each share of which carries 70 votes. After the offering, Pincus, 45, will control about 36.2 percent of the total voting power at Zynga through Class B and Class C shares he owns.

Companies often split their stock into different classes to keep control of the decisions about the company in the hands of founders and early employees. But having a class of shares carry 70 votes is unusual — about 10 is more common.

abcnews.go.com

Alessio Rastani

A financial trader who appeared on the BBC was not a hoaxer, the broadcaster has said after doubt was cast on his credentials.

It issued a statement after Twitter users suggested that Alessio Rastani was not a trader.

“We’ve carried out detailed investigations and can’t find any evidence to suggest that the interview… was a hoax,” the BBC said.

In the interview, Mr Rastani said traders “dream of recessions”.

He was interviewed live on the BBC News Channel on Monday and said: “For most traders, we don’t really care that much how they’re going to fix the economy, how they’re going to fix the whole situation – our job is to make money from it.

“Personally I’ve been dreaming of this moment for three years. I have a confession, which is I go to bed every night, I dream of another recession.”

He then added: “The governments don’t rule the world. [Investment bank] Goldman Sachs rules the world.

“Goldman Sachs does not care about this rescue package, neither does the big funds.”

After Twitter speculation that he was a member of hoaxers The Yes Men, the BBC press office made enquiries and concluded: “He is an independent market trader and one of a range of voices we’ve had on air to talk about the recession.”

On his website Mr Rastani describes himself as “an experienced stock market and forex trader and professional speaker”.

bbc.co.uk

Stock market crisis

Panic is once again sweeping through stock exchanges across the world, with the FTSE 100, the Dow Jones and the Asian markets all taking a pounding. Here we look at what it all means to you, and what you can do about it.

Pensions

The closure of final salary pensions and the shift to ones dependent on the stock market means the falls over the past month are more painful than ever for millions of workers. At the beginning of July, the FTSE 100 was standing at just over 6,000, but since then has lost about 17%-18% in value – more than £200bn – and further falls are looking likely.

Worst hit are those approaching retirement: they won’t be able to make up the losses. What’s more, the turmoil in markets has sent annuity rates to rock-bottom lows. Annuity rates determine how much pension income you get in return for the money you saved during your lifetime, so this means pensioners retiring today will see a lower income.

What can I do? More of the same: save more, work longer, retire later. Younger workers can ride the storm if markets recover. Older workers may feel compelled to shovel yet more cash into their workplace additional voluntary contribution schemes. Someone retiring now should speak to an independent annuity adviser urgently.

Savings

Last time around, when Northern Rock and then the Icelandic banks crashed, there was real panic about the security of savings. This time around the banks at the centre of the storm – Italian ones such as Unicredit and Intesa – are virtually invisible on the UK high street. If Spain moves centre stage then expect a rumble of concern about Santander, although it has passed stringent EU tests on its capital strength.

What can I do? The UK Financial Services Compensation Scheme has been improved since the last crisis, and now guarantees the first £85,000 of an individual’s savings (so a husband and wife or civil partner can protect as much as £170,000). The standard advice, if you have more than that amount, is to spread it around different accounts at providers which are not in the same banking group.

Mortgages

Here’s the silver lining. While the Italians and Spanish have seen money market interest rates shoot towards 6%, the reverse is happening in the UK. Short-term money has, oddly enough, become cheaper as markets now think the Bank of England won’t raise interest rates until well into 2012. In recent weeks, banks and building societies have been rushing out rate cuts on nearly all their deals, so if you’re coming off an expensive fixed-rate mortgage you’re one of the lucky ones.

The rate on a five-year fix has tumbled from about 4.5% to a record low of around 3.59% (see, for example, Yorkshire building society’s deal and others at moneyfacts.co.uk); two-year fixes have dropped below 2.7%; while tracker deals start at 2.49% at HSBC.

But the new banking crisis is probably bad news for first-time buyers, effectively shut out of the market by demands for huge deposits. This is unlikely to ease anytime soon as banks do everything they can to preserve their capital.

What can I do? If you’re on an existing tracker deal, which follows the Bank of England base rate, then you’re probably wise to do nothing and enjoy the ride. If you have a large mortgage, cannot afford a rate rise and think inflation is going to return, then jump into one of the five-year fixes.

Petrol, Gas, and Electricity

Good news. The oil price has come back from a peak of about $125 a barrel during spring to about $105. Commodity prices are under downward pressure as growth in China is slowing. If the world economy goes into a double-dip recession expect further falls.

Bad news. The “big six” energy providers have all raised prices, with 17%-18% increases in the gas price and about 10% added to electricity bills. However, if the wholesale price of gas and electricity tracks the price of oil, as it tends to do, maybe households will see an easing off in further price rises. But the utility companies have a long history of failing to pass on price falls in the wholesale market, so don’t expect price cuts in the short term.

What can I do? Now that all the energy providers have raised their prices, it is worth shopping around for the best deal.

Investments

Bad luck if your fund took a bet on European banks recovering. Ones that can play markets going down (the hedge funds and Ucits III funds) may in some cases have benefited. In general, financial advisers tell clients that the important thing is diversification, although one of the features of the 2008-09 market decline is that all asset classes – equities, bonds, property – went down, so diversification didn’t pay off much.

The big play of the past few years – mining and commodity stocks fuelled by voracious demand from China and other emerging markets – will look exposed if global growth slows.

Gold has been the safe haven choice for investors, but even it is losing some of its shine. The gold price hit a peak at nearly $1,900 an ounce in early September but has since fallen back to about $1,700. Gold has an interesting relationship with the US dollar. When the dollar is weak, it tends to rise; when the dollar is strong, its price falls back. As the euro crisis has deepened, the dollar has been strengthening. In recent weeks it has moved from $1.65 to the pound to just $1.55

guarian.co.uk

Inflation

Inflation can reduce the spending power of your money but there are ways to reduce its most corrosive effects.

With inflation running far ahead of the Bank of England target, most savers are finding that their money is worth less by the day. But there are steps that savers can take to avoid what has been described as a “slow motion bank robbery” – with a number of new products launched that promise to “inflation proof” your savings and deliver a real return. Below we look at the most popular options.

1. Inflation-linked bonds and accounts

With inflation a concern for many savers, some banks and building societies have launched inflation-linked products for those concerned about their cash losing value. However, it can be difficult to work out which ones are best for you, and some tie your money up for a long time.

The current bonds from National Savings & Investments have the advantage of not requiring you to pay tax on your interest, and offer 0.5pc above the RPI when held for five years. However, you can take your money out earlier and still get a return as long as you hold them for at least a year. You can put in £15,000 per issue. The bonds are available from www.nsandi.com.

Rival products include the Post Office’s bond which pays 1.5pc over RPI over five years or 0.5pc over three years, but is subject to tax, and a new bond launched by the Cambridge Building Society which pays 1pc over RPI fixed for five years.

2. ISAs

For those who pay tax on their interest it is almost impossible to outrun inflation. Based on June’s inflation figures, a basic rate taxpayer would require an account paying 5.63pc to beat the lower level of inflation (CPI), while a 40pc taxpayer would require an account paying 7.5pc to beat the same measure.

This makes it more important than ever to use your tax-free cash ISA allowance of £5,340 a year. The best rates are available to those who are willing to put their money away for five years, and include Northern Rock’s fixed-rate Isa paying 4.26pc over five years, just below June’s CPI figure. With inflation predicted to fall back from here in the coming months, this product should help your cash to maintain its value.

3. Mortgage overpayments

Once you have exhausted your tax-free savings options, there is one more option that can help you to outrun inflation, if you have a home loan. This is to make overpayments on your mortgage. By offsetting your savings against your debt, you effectively end up with an interest-free savings rate at whatever rate you are paying on your mortgage.

For many people this will be better than a top-paying savings account. However, you need to make sure that you do not fall foul of your lender’s rules on overpayments. Some mortgages are fully flexible, allowing you to make overpayments and get them back freely, while others do not allow you to take overpayments back, or will charge you if you make too many.

If you are thinking about remortgaging and like this option you could consider an offset mortgage with a bank like First Direct. The bank is currently offering a two year fixed rate of 2.99pc for those looking for a 65pc mortgage, which has flexible features.

4. Top paying savings account

If you want total security for your savings and have exhausted all other options and used your tax-free allowance, the best you can do is to find the best paying home for your money. You will get more interest if you tie up your money for longer, but the tax, if you have to pay it, is likely to take the total return way below inflation. Top accounts include a five year bond at 5pc from KRBS, and a similar product from Melton Mowbray building society paying 4.75pc.

5. Low-risk investments

£If you are happy to take on more risk, a portfolio of dividend-paying shares can help you to outrun inflation. This is only an option for those with a diversified portfolio and who can withstand (both emotionally and financially) the ups and downs of stock markets. The good news is that after a dreadful couple of years, the number of companies increasing or reinstating dividends this year outnumbers those that cut or cancelled payouts in 2009.

But investors might prefer to buy funds than invest in a spread of dividend–paying companies, which tend to be equity-income funds. These funds have had a tougher time than many over the past three years, but are starting to come into their own as dividends make a comeback. Equity income funds include Threadneedle UK equity Income, Rathbone Income and Newton Global Higher Income.

telegraph.co.uk

Retirement

You don’t have to move to Holland, Canada or Chile to improve your pension prospects – there are steps that all consumers can take to boost their retirement income. Here we list five of the best ways.

1. Join your company scheme

If your employer invests into the pension on your behalf, make sure you sign up. This is effectively “free” money: many firms have a matching arrangement where the more you put in, the more they will, too. Try to maximise your contributions to take advantage of higher rates.

2. Check charges

Those with a private (personal) pension should check the charges, particularly on older schemes. These should be listed on annual statements – if they aren’t, talk to your pension provider or financial adviser. Could you get a similar pension with a lower charge? It is now possible to buy a low-cost Sipp (self-invested personal pension), where you can choose which funds to invest in.

3. Check performance

Charges shouldn’t be viewed in isolation. It is also important to gauge how your pension fund is performing. If it is not delivering reasonable growth over the long term (five years or more), you should consider switching. However, be wary of switching on the back of one or two years’ poor growth – this could simply be the result of more general market movements.

If you have a high-charging fund delivering stellar performance, you are likely to be better off than with a low-charging, poorly performing one. However, many badly performing funds also have some of the highest charges.

4. Shop around for an annuity

Two in three people still take the annuity deal offered by their pension provider – yet they could boost their income by a third by shopping around. Tell your annuity provider about any previous health problems, or medication you might be taking, as this can significantly boost your income. This also applies to those who smoke, have high blood pressure or are overweight.

5. Start young

Thanks to the benefits of compound interest, it can pay to start young. As a rule of thumb, take the age you started a pension, halve it – then save that percentage of your salary each month. For those who do not get around to pension planning until their forties, they really need to be squirrelling away 20pc of their salary if they want a comfortable retirement.

telegraph.co.uk

Best shares in the world

Apple is the world’s most desirable company, according to a poll of investors. When Barclays Stockbrokers asked its clients which stocks they would hold in their dream international portfolio, the technology giant behind the iPad and iPhone was the most popular choice, with 47pc of respondents choosing the company.

Next came BP, picked by 24pc, and GlaxoSmithKline on 10pc, followed by Google (7pc), Royal Dutch Shell (6pc), Microsoft (5pc) and McDonald’s (2pc).

So if you are looking to build an international portfolio of stocks, are these seven a good place to start? In this Share Watch special, we find out what analysts in the City and on Wall Street think of them.

Apple

You’ve probably never heard of Michael Anderegg, but he is certainly prepared to stand out from the crowd: the analyst, who works for Blue Water Capital Markets, is the only one on Wall Street to rate Apple a sell.

All 51 of the other brokers who write about Apple reckon the shares are at least a hold, with the vast majority – 49 – rating them a buy, according to FactSet Research Systems.

It’s not hard to understand their enthusiasm. Apple has a track record of coming up with products that everyone wants – and thanks to its reputation as the coolest technology brand, competitors tend to struggle even when they produce cheaper or better alternatives.

Analysts at Credit Suisse in New York are among the believers. In a note headed “outsmarting, outgrowing, outperforming”, they judged Apple the best smartphone maker. “Even four years after the launch of the first iPhone, few vendors come close to comprehensively closing the gap,” they said.

Credit Suisse reckoned that the company’s profits could increase by almost 50pc annually between 2010 and 2012, concluding that Apple’s valuation relative to earnings was “attractive”. They set a price target of $500. The average price target of the brokers monitored by FactSet is $448.90.

Several British stockbrokers trade in US shares; Barclays, for example, will charge you a minimum commission of £12.95, plus a foreign exchange conversion fee.

BP

Most analysts rate BP a buy but Stuart Joyner and Angus McPhail of Investec have particularly strong views on the under-performance of the share price and what the company should do about it.

BP relies on a “broken” business model and is worth almost 30pc more than its current market value, they said. They reckon the way to release that value is to break the company in three – a US business, a British arm and an emerging markets focused “BRIC-ish Petroleum”.

“We call for a radical, full demerger of BP to close the acute discount to our view of fair value,” Mr Joyner and Mr McPhail wrote. “We think investors should pressure BP to accelerate the non-core disposals and BRIC entry strategy.

Although they set a price target of 550p, the analysts said their “best case” valuation was 750p.

Their counterparts at Evolution described BP as “the big recovery story” among the integrated oil companies. Setting a price target of 510p, they said: “The valuation gap is compelling.”

Twenty-one of the 35 analysts monitored by FactSet rate BP a buy, with 13 saying hold and just one seller. The average price target is 564p.

GlaxoSmithKline

Shares in the British drugs maker have gone nowhere in the past few years as investors wondered how the company would replace profits from former “blockbusters” hit by patent expiries and competition from cheaper “generic” medicines.

But there are signs that their pessimism may have been overdone. Analysts at Shore Capital said recently: “We are past the nadir for GSK at last.”

They acknowledged problems such as falling US demand for Advair, the asthma treatment that accounts for 25pc of GSK’s sales, as well as European austerity measures and health-care reform in the US. But they said: “We suspect the Advair franchise is a much longer-duration asset than the market currently anticipates.” Shore said it expected GSK to retain its global leadership position in respiratory treatments.

It also praised GSK’s consumer-health division and the company’s progress in developing markets. “In totality, we believe that GSK possesses a much more defensive portfolio of businesses than the market currently perceives,” the broker said.

It forecast long-term sales growth of 4pc a year, producing annual earnings growth of 9pc (on a per-share basis). The shares yield about 5pc. “We believe that if our expectations for key franchises are realised, GSK should trade at a premium to its peers,” Shore’s analysts concluded, setting a price target of £15.35.

Their counterparts at Evolution said: “We note that GSK is in the guts of its transition to sustainable growth and still believe the stock will return to sustainable ‘mid-single-digit’ sales growth from 2012. We reiterate our buy rating and £15.50 price target.”

The most common rating among analysts is hold – 15 of the 36 tracked by FactSet opt to sit on the fence, with 14 buyers and seven sellers. Their average price target is £13.54.

Google

Most of us are familiar with Google as the first port of call for finding websites on our PC, but the company has diversified greatly from that original business and now has its fingers in many pies.

More to the point for investors, it is busy making these new activities profitable. As UBS pointed out recently, Google’s display advertising business is producing revenues of more than $2.5bn and mobile advertising is making $1bn, while YouTube is making money from serving two billion videos a week to its users.

“We expect the focus to remain on building multi-billion dollar revenue streams out of the mobile, display, video, enterprise [corporate customers] and other businesses,” UBS said, adding that recent changes to Google’s management and structure were creating a “nimbler company”.

UBS, which rates Google a “key call”, said Google offered the best long-term exposure to growth trends such as broadband penetration, mobile internet and software hosted in the “cloud” – online, rather than on personal computers.

The Wall Street consensus on the company is strongly favourable: 33 of 38 brokers say buy, with the remainder at hold, according to FactSet. The average price target is $708.89.

Shell

Shell has kept a rather lower profile than BP of late but that didn’t stop analysts at Collins Stewart naming it as their top pick among the oil “supermajors”.

The broker said the market had not appreciated the impact of two major new projects in Qatar, which it estimated could produce the equivalent of 11pc of Shell’s 2010 production and 25pc of last year’s cash flow.

Meanwhile, analysts at Bernstein said Shell’s technical leadership in areas such as ultra-deepwater and Arctic exploration should help the company grow production and deserved a premium.

Of the 37 analysts tracked by FactSet, 25 rate the shares a buy; 10 are holders and two would sell. The average price target is £25.45.

Microsoft

For many years, Microsoft seemed to have a licence to print money thanks to the almost universal adoption of its Windows software for PCs.

Times are tougher now, with many abandoning traditional computers for smartphones and tablets such as Apple’s iPad. Here, Microsoft is playing catch-up; it recently signed a deal with Nokia that will see the handset maker use Windows software on its smartphones.

Deutsche Bank said: “Its Nokia deal is a step in the right direction and will help expand Windows Phone 7’s footprint, attracting more developers to the platform.” On the basis of Microsoft’s expected cash flows over the next 10 years, it put a value of $35 on the shares.

Meanwhile, analysts at Credit Suisse expect the forthcoming Windows 8 software to have a greater impact in the tablet market than investors expect. Their price target is $36.

Of the 35 analysts tracked by FactSet, 25 are buyers and nine say hold, with just one seller. The average price target is $32.93.

McDonald’s

McDonald’s is a favourite on the Wall Street menu – no broker rates the shares a sell, while 17 of the 25 monitored by FactSet are buyers.

The fast-food chain is one of UBS’s 13 “key calls” among US shares. The bank rejected the idea it’s just a recession stock where cash-strapped families can buy a meal for a few dollars. UBS set a price target of $87 on the shares, but with the potential for the upper $90s in the best case.

The chain is also getting a makeover. When Deutsche Bank analysts visited some of the revamped outlets in Florida recently, they were impressed by the “very contemporary” exteriors and interiors, as well as extra capacity.

“We believe this program will help McDonald’s … to widen the gap with competitors, which generally do not have the capability to execute similar re-investments,” the analysts wrote.

Deutsche Bank’s price target is $89, compared with the FactSet average of $87.52.

telegraph.co.uk

pensions

Two-thirds of small companies do not currently provide a pension scheme for their staff, research indicates.

Around 96pc of firms employing 250 or less people that do not have a pension scheme said they were put off offering one because of the costs involved, according to the Association of Consulting Actuaries.

But new regulations mean that between 2014 and 2016, the sector will have to begin automatically enrolling staff into a pension scheme, although individuals will retain the right to opt out.

By October 2017, workers will have to contribute at least 4pc of their pay to a scheme, with companies paying in 3pc and the Government topping this up with 1pc.

However, 35pc of smaller firms said they expected their employees to opt out of pension provision, with 84pc saying the cost would put them off, while two-thirds thought their staff were disillusioned with pensions.

Savers see £5bn wiped off their investments

Interest rates have failed to keep pace with inflation, meaning that people who have tried to save some of their income this year have actually ended up losing money.

Savers were already suffering due to shrinking rates of return on their investments after the Bank of England cut interest rates to 0.5 per cent nearly two years ago.

Rising inflation has added to their misery this year, with figures suggesting that savers lost the equivalent of 2 per cent on their money.

This is the difference between average inflation – 4.6 per cent – and the average return of 2.6 per cent earned on a fixed-rate savings deal.

It leaves savers £5 billion out of pocket, based on total investments of £250 billion in fixed rate savings accounts, according to the figures calculated by personal finance website Candidmoney.

With an estimated 38 million savers in Britain, this is the equivalent of every saver losing £131 each.

Justin Modray, of Candidmoney, said: “High inflation has still left many able to buy less with their savings than at the beginning of the year.”

The Consumer Price Index, the Government’s preferred measure of inflation, climbed to 3.3 per cent in November, up from 3.2 per cent the previous month, according to figures from the Office for National Statistics. Higher prices food and clothing contributed to the rise.

The Retail Prices Index (RPI) measure of inflation also rose to 4.7 per cent last month, up from 4.5 per cent in October.

Experts warned that the miserable situation for savers is unlikely to change next year despite widespread speculation that the Bank Rate will rise.

Michelle Slade, of Moneyfacts, said: “Savers are having a paltry time as rates have fallen to some of the lowest rates we’ve seen at some points during this year. Next year is going to more of the same. If Bank Rate does rise, providers will be looking to maintain some of the current profit margins and are unlikely to pass the all the rises on to savers. So savers are going to be in for a torrid time again next year.”

Basic rate taxpayers need interest of 5.89 per cent to beat inflation. Just two accounts offer this rate – the Yorkshire and Barnsley building societies pay 6 per cent, but require an investment in an L&G investment bond to qualify. A higher rate taxpayer needs 7.83 per cent to make a real return.

The only inflation-beating Individual Savings Account available on the high street is from Santander, paying 5.5 per cent and savers must invest in a linked investment product to qualify.

Handbags from Hermès, Tiffany diamonds and a Cartier watch would be on most of our fantasy Christmas lists. But in these austerity times can you justify such extravagance?

It seems quite a few can, as Burberry, Ralph Lauren and Richemont have all announced healthy profits – proving that for the luxury goods sector at least, the recession is over.

But rather than lusting after the goods, how about owning a small part of the companies behind them instead? Luxury goods are an excellent way to tap into the emerging markets story, as the growing middle classes in India, Russia and China seek the trappings of a wealthy Western lifestyle.

Sales of luxury goods have soared in emerging markets – and Asian tourists make up a large proportion of European sales as well. There are currently 89 billionaires in China – the second largest number in any country after the United States – and this number is growing.

Below, we examine 10 luxury goods companies and give you their ratings according to Bloomberg’s brokers on whether to buy, sell or hold.
1. BURBERRY

PRICE 1040p
MARKET LSE (UK)

Burberry reported record half-year profits last week – proving that for the fashion house at least, the recession is well and truly over.

Pre-tax profits were up by 50pc to £118m and total revenues increased by 21pc, in the six months to the end of September. As a result of the good news, Burberry bumped up its dividend by 43pc to 5p.

The share price has risen by more than 130p since American Angela Ahrendts took over as chief executive in 2006, making Burberry the third most successful listed retailer in Britain over the past five years.

Emerging market sales and digital developments can be credited with this rise – sales in China, India and Brazil were up 46pc in past six months – and will fuel further gains in the future.

BUY 3, HOLD 19, SELL 3
2. MULBERRY

PRICE 638p
MARKET LSE

Another quintessentially British brand, leather goods retailer Mulberry has seen the price of its shares rise by 963pc from 60p in the past 17 months. Established in 1971 in Somerset – where its headquarters still reside – the majority of the bags, and now clothes, shoes and jewellery, are usually still made in Britain.

Increasingly popular with Asian consumers as a way of buying into the “English country peer” lifestyle, revenue went up from £58.6m in the year to March 2009 to £72.1m in the year ending in March this year.

As a result the dividend payment was raised from 2p per share to 2.2p.

BUY 2, HOLD 0, SELL 0
3. LVMH

PRICE €120
MARKET PAR (France)

Over the Channel, almost every luxury brand belongs to one mega-group – Moët Hennessy Louis Vuitton, or LVMH. Under the LVMH umbrella fashion houses nestle next to watch manufacturers, perfumeries, makers of wines and spirits, and jewellers.

Among the more global names: Donna Karan, Moët & Chandon, Givenchy, De Beers and TAG Heuer.

Henk Potts, equity analyst for Barclays Wealth, said: “We view LVMH as a core holding in the luxury goods sector owing to its strong management team, high-quality brands, and significant earnings growth potential in addition to its recent acquisition of a stake in Hermès.”

Mr Potts said that British investors should not be put off if a stock is listed overseas. “Many execution-only brokers, including Barclays Stockbrokers, will allow you to buy stocks that are listed overseas,” he said.

BUY 23, HOLD 10, SELL 2
4. BMW

PRICE €59
MARKET DAX (Germany)

Bayerische Motoren Werke – or BMW as it is more commonly known – owns the motor car brands BMW, Rolls-Royce and MINI. Listed on the DAX exchange, which is made up of 30 of Germany’s biggest blue chip companies, BMW is the global leader in premium car sales.

In 2009, BMW sold 1.1 million units, compared with the peak of 1.3 million in 2007 – before the credit crisis.

Things are looking up, however, and luxury cars manufacturers look as if they have the worst of the recession behind them. BMW’s global sales rose by 13pc in the first six months of this year alone. Mr Potts said: “BMW holds a strong position within the luxury space thanks to the roll-out of the new series five .”

BUY 28, HOLD 12, SELL 4
5. RICHEMONT

PRICE Sfr56
MARKET VTX (Switzerland)

You may not have heard of this parent group but there’s a good chance you have dreamed of owning their brands.

Cartier, Van Cleef & Arpels, Piaget, Vacheron Constantin, Jaeger-LeCoultre, IWC, Panerai and Montblanc are all part of the Richemont Group. The group, which is listed on the Swiss stock exchange, announced last week that it nearly doubled its pre-tax profits in the six months to the end of September compared with the previous year, increasing from €416m to €742m.

Global sales rose 37pc over this period – but sales in the Asia Pacific region rose even more with a 50pc increase.

“We did great in all of the European markets except one small one,” said chief financial officer Gary Saage.

“Fifty per cent of the sales were still done by travellers who [don’t live] in western Europe – but the locals are back for us too.”

Telegraph.co.uk