The Lowland Investment Company, which she co-manages, has HSBC, Shell and BP among its top 10 holdings. Alternatively, investors could buy a spread of oil companies via the Xtrackers MSCI World Energy ETF, and banks via the Xtrackers MSCI World Financials ETF.
Ms Foll said consumer-facing businesses would also do well in 2022 because households had built up their savings during the pandemic. “Recent trading updates from Marks & Spencer and Halfords suggested that households would be willing to spend their extra savings despite high inflation,” she said.
TipRanks, which tracks stock market research, found that analysts were forecasting big returns from companies that had recently been hit by new restrictions linked to the omicron variant but were still good businesses that would recover.
Analysts said pub chain Mitchells & Butlers, coach operator Stagecoach, caterer SSP and easyJet, the airline, could rise by 41pc, 34pc, 33pc and 24pc respectively over the coming year.
However, BlackRock, the asset manager, said investors should not get carried away with buying companies that would benefit from a reopening of the economy. Nigel Bolton, its investment chief, said: “We don’t think it’s simply a case of buying these cyclical sectors. Covid has accelerated trends that are disrupting traditional industries.”
He argued that energy companies were wrestling with the costs of the transition to renewable energy, and banks faced competition from digital rivals. Instead, he suggested that investors buy companies that are able to pass on cost increases to consumers to maintain profit margins, such as European luxury brands. LVMH, Kering and Burberry are some of the largest.
Big technology companies were also important to own, he added, as they were “asset-light” businesses that would not suffer large increases in costs despite the return of inflation, while the pandemic had accelerated online activity. Microsoft, Adobe and Alphabet, which owns Google, are some of the largest online businesses.
