THE declining dollar and volatile oil price have dominated sentiment in stock markets. But some of the holdings in the Share of the Month portfolio continue to benefit from dollar weakness.

Take Gap, owner of the Gap stores, Banana Republic and Old Navy. The fall in the dollar means that travellers to America from the UK and the rest of Europe can buy Gap products at a discount.

The luxury goods companies L’Oréal, Bulgari, Tod’s, Richemont and PPR suffer as US consumers balk at losses in currency translation when buying European high-end goods. Yet world travel has recovered and purveyors of luxury goods have new products to tempt the affluent worldwide.

PPR has disposed of Rexel, the electrical equipment wholesaler, cutting net debt to $5 billion (£2.6 billion), and is focusing on retail and luxury, via Gucci. Tiffany, meanwhile, expects “a healthy sales increase” in the US holiday season after disappointing third-quarter results. I am suspending spending at all these retailers, but will hold their shares.

Despite falling oil prices, I am also tightening my grip on shares in Shell, ENI, Premier Oil and Schlumberger.

Continued chaos and violence in Iraq, the threat of supply disruption and strong demand for energy from China and India, make the shares must-haves.

STELLA SHAMOON

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