While bad news comes in torrents, good news drips. Few could escape being made aware of the walloping meted out to equity investors during all four quarters of last year and the first three months of this. From peak to trough, between October 2007 and March 2009, the FTSE 100 index lost 45 per cent of its value in what seemed to be a relentless march towards the abyss.

Losses for the first quarter of this year were softened by the improving picture towards the end of the period, but even so you would not want to be stitching together a series of 12 per cent falls — and that is how much the FTSE 100 lost in the first three months of the year.

Nor is a 12 per cent fall over three months easy to forget, while gains of a similar amount can be overlooked. The FTSE 100 rose by a little more than 8 per cent in the second quarter. Part of the reason why the gains are less celebrated is because they tend to come more gradually. Confidence in the assumption that the financial world is past the worst is taking hold, but few dare to tempt fate, realising that it is far too soon to be sure that the recovery will take root and that any sense of complacency could be rewarded with a thumping wake-up call.

The intricacies of mathematics also mean that a 12 per cent fall can be followed by an 8 per cent rise and still leave the overall loss at 5 per cent — and this is what has happened to the FTSE 100 in the first six months of 2009. In stock markets, as in fell walking, it is harder going uphill.

The Personal Investor Portfolio of ten stocks to follow for 2009 has, like the FTSE 100, clawed back some of the ground lost in the first quarter. Where only one of the ten gained value in the first three months of the year, eight of the ten are up in the second quarter. Together they have added just under 8 per cent, where they lost 14 per cent in the first three months of the year, narrowing the loss for the six months to 8 per cent.

Even shares in Workspace, the property company that lets office space in secondary locations, mostly to small and medium-sized businesses, have risen since the start of April, though the improvement barely makes a dent in the losses incurred in the first three months. The wounds caused when balance-sheet doubts prompted the company to hold a deeply discounted, and deeply dilutive, rights issue have not yet healed.

Shares of Vodafone and Reed Elsevier were the two Personal Investor selections to give up ground in the second quarter. News that Vodafone shelled out £500,000 to help its former chief executive, Arun Sarin, to relocate to the US after leaving the company might have miffed some investors. The company also said that it is to move its headquarters from Newbury to London, weakening the links of which the Berkshire market town was proud.

Of greater concern, in share-price terms, is the fact that European Union regulators showed their determination to push the phone company into slicing the fees it charges other network operators for connecting calls. Doubts that Vodafone may get itself into trouble bidding for the UK arm of T-Mobile also weighed, while other encouraging factors — on cost-cutting and an increase in revenues at Verizon, its part-owned US venture — failed to compensate.

Reed Elsevier, the Anglo-Dutch publisher of The Lancet, among many other titles, found itself a new chairman — Anthony Habgood, formerly of Bunzl. It has a relatively new chief executive, too, in Ian Smith, and you might expect the fresh faces to inject some fresh impetus, especially because the old guard left the company in decent shape. Shares suffered, however, as investors looked for more excitement. Reed is about as steady a media stock as exists — it is the reason why it was included in the portfolio in the first place — but in recent weeks investors have shown enhanced appetite for risk.

Associated British Foods (ABF) is a pretty steady business, too, and might have been tarred with the same “boring” brush as Reed. ABF, however, owns Primark, the cheap-as-chips fashion retailer, and expectations that it would benefit from rising consumer confidence seem to have pushed shares higher. The bullish sentiment was contradicted by ABF’s profits falling 33 per cent in the six months to February 28, but past performance seems to have been taken as an unreliable guide to the future.

Serco, the support services company, has risen 17 per cent in the second quarter, bolstered by new contracts to build two prisons, at Maghull on Merseyside and Belmarsh in southeast London. It also won a contract to undertake air traffic control at airports in Dubai.

National Grid, the power transmission utility, struggled against rumours that it would launch a rights issue and registered a modest gain in the second quarter. AstraZeneca, meanwhile, found the going easier. Its shares rose 14 per cent between April and July, cutting the year-to-date loss to 3 per cent.

The overall performance of the Personal Investor Portfolio has been rescued by 3i, the venture capital investment trust. In the first quarter this company was rocked by the sudden departure of its chief executive, Philip Yea. In the second quarter the company held a rights issue. But by emphasising that the money would be used for investment rather than only to alleviate the company’s debt burdens, 3i convinced an overwhelming majority of shareholders to back the capital-raising.

Shares have risen smartly as well. But though 3i is the star turn of this portfolio, it is also the one that looks the most vulnerable to near-term shocks.

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