Rolls-Royce Holdings PLC (LSE:RR.) and BAE Systems PLC (LSE:BA.) have overtaken Nvidia Corp (NASDAQ:NVDA, ETR:NVD) as the two most popular shares among investors in June, according to data from Kepler.
The UK-listed defence giants claimed the top spots, pushing the previously dominant US chipmaker Nvidia out of the top 10 most-bought shares for the first time in recent months.
This comes even as Nvidia’s share price continued to climb, gaining around 22% over the period. Kepler suggests some investors may be booking profits and expressing caution over Nvidia’s lofty valuation as it scales new record highs.
The growing enthusiasm for defence shares has been underpinned by political commitments made at the recent NATO summit, where member states pledged to raise defence spending to 5% of gross domestic product.
This renewed focus on the sector is reflected in flows into the WisdomTree Europe Defence UCITS exchange-traded fund (ETF), which has attracted $3 billion in assets since its March launch and has returned 16.6% in that time.
Over the past 12 months, Rolls-Royce shares have surged by approximately 108%, while BAE Systems is up 47%, outpacing many other blue-chip names on the London market.
However, both stocks have been left in the shade by Germany’s Rheinmetall, which has soared by about 238% over the same period, further highlighting the strength of investor appetite for the European defence sector.