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I think these FTSE 250 stocks are too expensive to miss today. Here is the reason.
The comforts of home
Home builders love it Bellway (LSE:BWY) is set to rise in value in 2024, with falling interest rates and improving consumer confidence helping home sales resurface in recent sources.
What motivates this upward trend is always on the trap. According to Halifax today (7 October), the average UK house price reached £293,399 in September. This was below the record high of £293,507 before the housing market crashed almost two years ago.
Rates are flying again thanks to lower mortgage rates and positive wage growth. With the Bank of England (BoE) expected to continue cutting interest rates over the next 12-18 months, again, housebuilders should go from strength to strength.
Bellway's share price is up 22% since the start of the year. I think it may go further when the full year results are released next week (15 October), when the company advises on the current market situation. In its last update in August, it said its weekly private bookings rate rose 10.9% in the 12 months to June.
There are risks here, of course. A sudden rise in inflation could prompt the BoE to dial back its interest rate plans, hitting housing sales in the process. Rising construction costs also remain a major threat to the entire construction industry.
Still, I think Bellway remains an attractive value stock to buy right now. It trades at a forward price growth (PEG) ratio of 0.8. Any sub-1 reading suggests that the stock is undervalued.
Playing for the rescue of China
Investing in stocks heavily dependent on China has been a nightmare for many. My buying decision is focused on Asia Prudential's stocks in 2020 have spectacularly failed to pay off so far.
But the market mood appears to be shifting in favor of companies with more exposure to China, as Prudential gains in share prices. For investors looking for return stocks, now would be a good time to consider stocks like these.
I Fidelity China Special Conditions (LSE:FCSS) investment trust is one FTSE 250 asset on my watch list. Like The Pru, it has also strengthened significantly in price recently, as the chart shows.
However, at 247.5p per share, it still trades at a 10.7% discount to its net asset value (NAV) of 277.1p per share.
Trusts like these spread capital across multiple companies, giving them access to more growth opportunities while allowing them to manage risk. In total, it has 100 large, medium, and small Chinese firms, including familiar names such as Tencent Holdings share price, Ping Insuranceagain HiSense.
Look, there is no guarantee that the Chinese economy is over the worst. Indeed, the data from the Asian powerhouse remains overwhelming. However, as lawmakers accelerate measures to revive growth, things could be looking up for the emerging market, and therefore Fidelity's confidence.
Indeed, with China's growing middle class driving domestic consumption, and technological innovation steadily improving, my long-term outlook is very bright.
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