One month in the past, on 9 April, traders have been digesting an 11% drop within the FTSE 100 in simply seven days.

In case anybody missed that, this sharp fall was triggered by President Trump’s ‘Liberation Day’ tariff announcement on 2 April.

On the time, I didn’t count on the market to be again in constructive territory inside just a few weeks. However that’s the place we’re. A £10,000 funding within the FTSE 100 on 2 January would have been value £10,620 at market shut on 7 Might, together with dividends.

Admittedly, the FTSE 100 remains to be under the highs seen in March. However a 6.2% return in simply over 4 months isn’t a foul end result in my opinion. I’d chalk this up as a win for taking a long-term method.

A FTSE inventory to contemplate shopping for

When a inventory index just like the FTSE 100 strikes up or down, it’s often reflecting a a lot wider vary of particular person share price actions throughout the index.

We’ve actually seen that this yr. The highest riser within the FTSE 100 to date this yr is up by greater than 70%. The most important faller is down by practically 30%.

The chance for stock-picking traders is to seek out shares which have a constructive outlook and are nonetheless low cost sufficient to ship additional beneficial properties.

One firm I feel matches this description is Lloyds Banking Group (LSE: LLOY).

Lloyds shares are up by a wholesome 33% to date this yr, however in my opinion, there are some good causes to contemplate this inventory as a doable purchase.

Positioned for long-term development?

Because the UK’s largest mortgage lender, Lloyds may benefit from any upturn within the housing market. This week’s Financial institution of England rate of interest lower might assist to enhance mortgage affordability and encourage homebuyers to decide to new offers.

Trying additional forward, the financial institution can also be working to increase its market share in areas which are much less depending on curiosity revenue. These embrace wealth administration and industrial banking companies.

Maybe the principle danger proper now could be Lloyds’ publicity to the FCA’s motor finance fee evaluate. Lloyds has an enormous presence on this sector by means of its Black Horse enterprise. Administration has already put aside £1.15bn to fulfill potential compensation prices and further overheads.

I’m assured the financial institution will have the ability to handle any doubtless prices. However till we get the Supreme Court docket choice on fee funds that have been made with out prospects’ consent, it’s unimaginable to know the doubtless influence.

The best time to purchase?

Warren Buffett as soon as stated, “The future is never clear; you pay a very high price in the stock market for a cheery consensus”.

What Buffett meant was that when everyone seems to be comfortable and optimistic a couple of enterprise, it’s typically already very costly.

Lloyds shares aren’t as low cost as they have been in January. However the financial institution’s steadiness sheet seems wholesome to me, and my sums recommend the 5% dividend yield ought to be protected.

Analysts count on the dividend to rise by a chunky 20% in 2026 – if appropriate, that would give a 6% yield on shares purchased at present ranges.

On steadiness, I feel Lloyds shares stay engaging and are value contemplating as a doable purchase for revenue traders.