An AIM company was among the most popular purchase by UK investors in June, though blue-chip giants continued to top the lists of most-bought shares for June.
Lloyds Banking Group PLC (LSE:LLOY) and Legal & General Group PLC (LSE:LGEN) were the most-bought shares on two of the country's largest DIY investment platforms for the past month.
Also on the list for the 10 most bought shares on the Interactive Investor (ii) platform was Premier African Minerals Ltd (AIM:PREM).
The AIM-listed mine developer, which captured attention amid talks with a partner over an offtake deal for the Zulu lithium and tantalum mine project in Zimbabwe, was also the second-most popular share on the Hargreaves Lansdown platform for the past week.
Hargreaves is the UK's largest retail investment platform, ahead of ii, which is owned by London-listed Abrdn, second and AJ Bell in third.
Lloyds topped the ii most-bought equities list for the month, followed by Vodafone Group PLC (LSE:VOD), Tesla Inc (NASDAQ:TSLA), Legal & General and Glencore PLC (LSE:GLEN).
L&G sat atop the AJ Bell platform's top 10, followed by BP PLC, Shell PLC (LSE:SHEL, NYSE:SHEL), Glencore and Tesco PLC (LSE:TSCO).
While Tesla rose up the popularity table with ii, up from 10th the month before, it divided opinion among UK investors, as it was the most sold share on the AJ Bell platform, with NVIDIA Corporation (NASDAQ:NVDA) similarly figuring on both tables.
Rolls-Royce Holdings PLC (LSE:RR.), which has been one of the most popular UK stocks in the past two years, also dropped out of ii’s best buys in June.
"Perhaps as investors take stock after its impressively bullish run," said ii analyst Victoria Scholar. "Over the past six months, the engine maker has been the best performing stock on the FTSE 100, surging over 60%. In May, CEO Tufan Erginbilgic who took over in January, said its turnaround was moving at pace and reiterated the company’s full-year guidance."
As background to the purchases, global equities rallied in June, with the MSCI All Country World Index rising 5.8%.
Meanwhile, the UK equity market as measured by the MSCI UK, fell around 2% in the month, meaning it has returned around 2% in the year to date.
This makes it one of the worst-performing regions, with stock benchmarks in the US and the Eurozone having gained about 15%, the UBS chief investment office noted.
Most popular shares on ii in June
- Lloyds
- Vodafone
- Tesla
- Legal & General
- Glencore
- Asos
- Aviva
- NVIDIA
- Premier African Minerals
- BP
Most popular shares on AJ Bell to 4 Jul
- Legal & General
- BP
- Shell
- Glencore
- Tesco
- HSBC
- BAE Systems
- Unilever
- Tesla
- Lloyds
Top sells on AJ Bell for the month
- Tesla
- Glencore
- Rolls-Royce
- IAG
- Lloyds
- Polymetal
- Legal & General
- NVIDIA
- GSK
- Carnival
"The reason for the UK’s lag is in the sector mix," said UBS analyst Caroline Simmons, noting that the US rally has been driven mostly by the “surging seven” mega-cap tech stocks amid the AI-related investor frenzy.
"The UK market has just a 1% weighting toward technology, with more of a tilt to sectors with weak earnings dynamics. The Eurozone has benefited from a mix of China reopening beneficiaries such as luxury, and higher exposure to technology and industrials."
Sector-wise, she noted that financials, industrials, and IT are the best performers in the UK, with double-digit gains, while the materials sector is the biggest laggard this year, with a double-digit drop, while consumer staples also declined and energy is broadly flat.
"This roughly reflects the earnings dynamics of the sectors — earnings per share (EPS) growth for this year is the highest for financials, followed by industrials, healthcare, and IT. It is expected to be broadly flat for consumer staples in 2023, while double-digit negative earnings growth is anticipated in the energy, materials, and consumer discretionary segments.
"The question is, where do things go from here? That will depend on the macroeconomic backdrop. If growth globally slows over the course of the year, as we expect, and developed markets see GDP growth at or below 0%, we think the more defensive parts of the market are likely to outperform (like consumer staples and utilities)," Simmons said.
"But commodities would continue to struggle, in our view. This is already priced in for UK equities, with the MSCI UK trading on a 12-month forward P/E of just 10.2x, low by historical standards. Meanwhile, consensus expectations for 2023 earnings growth are already broadly in line with our estimate of –7%. As interest rates peak and investors start to focus on the prospect of policy easing in 2024, we believe there is scope for the FTSE 100 to recover and forecast the index will reach 8,200 in about 12 months."