Pawnbrokers, online retailers and takeaway food chains could be among the small-cap winners next year, bucking the downward trend after a challenging year that saw smaller stocks lose around a third of their value. "I can see companies in this kind of territory being pretty defensive next year," said FinnCap analyst Duncan Hall. Over the past year turmoil in the financial sector has eroded confidence in the wider economy but value-led firms should trade well in 2009 as consumers become increasingly thrifty and companies across Britain slash jobs and investment.
Thrift-based operations like Christmas savings club Park Group, pawnbrokers Harvey & Thompson and Albemarle & Bond should do well, as will home credit groups like S & U, Mr Hall said.
Business rescue and asset recovery company Begbies Traynor also looks set to perform well in the year ahead with its insolvency division likely to trade strongly as casualties from the credit crunch mount.
"The fact is that Begbies Traynor does well when smaller businesses do badly and I would expect that to carry on," said Teathers analyst Stephen Thomas. "The company is national and has all regions of Britain covered and the pipeline seems to be full of struggling companies that will need their services."
The downturn has also hit the high street as consumers cut spending amid fears of unemployment and falling house prices.
But AIM-listed online fashion retailer ASOS has been bucking this trend, benefiting from the migration of retail spending from the high street to the internet.
"ASOS is a genuine growth story and with clear revenue drivers at home and overseas, underpinning strong growth prospects over the coming years there is a strong likelihood of earnings upgrades," said KBC Peel Hunt analyst John Stevenson.
Home shopping firm N Brown is also likely to be boosted by increasing internet penetration, added Mr Stevenson.
Consumers are also shunning nights out, preferring to stay in and order takeaway food.
Dominos Pizza, which has outperformed the FTSE All Share .FTAS index by over 50 per cent since the start of this year, will likely continue to pick up trade as consumers choose to stay in rather than go out in response to the economic downturn.
"People are trading down, staying at home, and Dominos is taking market share," said Altium leisure analyst Greg Feehely. "We've knocked about 60 per cent off the sector this year but have upgraded Dominos by 15 per cent, which I think will continue because it has real and continuing momentum." Spain's biggest pizza-delivery chain, Telepizza is also trading well and expects sales to grow during the economic downturn as more people opt to order in.
While the takeaway food businesses thrive, its once-booming construction industry continues to flounder as house prices and commercial property values keep falling.
London-focussed property developer Telford Homes could be one of the sector's only winners next with a raft of projects for the 2012 Olympic Games and strategic partnerships set to insulate it from the economic downturn.