Another interesting month in the stock markets. In November, things went a bit bonkers (in a good way) and the unloved FTSE100 had its best month since 1989. What is everyone up to?
Fixed fee platform Interactive Investor noted an Eastern flavour to purchases for the second month in a row, particularly amongst investment trusts. 3 China specialist trusts were in the top 4 most bought– the Baillie Gifford China Growth Trust, Fidelity China Special Situations and JPMorgan China Growth & Income investment trusts were in second, third and fourth positions respectively.
The eastern flavour was also prevalent in the list of funds bestsellers, with Baillie Gifford China in third position, Baillie Gifford Pacific in seventh and Legg Mason IF Japan Equity in 10th position. Global shares are certainly flavour of the month across the board and Baillie Gifford American and Fundsmith Equity funds remain in the best-selling lists of most platforms.
Although UK funds are not popular right now, the FTSE100 has had a good run, as hopes for a Brexit trade deal grow despite the inevitable argy-bargy between the English and the French. There are pockets of opportunity and some shares are having a moment in the sun. For example, lots of investors are buying Rolls Royce. This was the second most bought share on AJ Bell Youinvest this week, and popular across the board. To be fair though before you all get FOMO and get twitchy trading fingers, it was also the second most sold share on AJ Bell Youinvest this week as some take profits. Lloyds Banking Group and Cineworld are other shares being most actively traded today. Whassup?
Poor old Cineworld has fallen over 11% this morning after news that Warner Bros will make their films available via streaming services at the same time as cinema releases in 2021. That said, it’s more than doubled over 1 month as a result of vaccine euphoria. Boing Boing. I guess our view on this stock’s future depends largely on why we go to the cinema? If it’s just to watch a film, you might think their days are numbered. If it’s to justify buying and eating a kilogram of Pick’n’Mix, or to have a sleep whilst the children watch some rubbish in a contained environment, then you might feel surer about their future ;0). Day trader heaven.
Lloyds is swept up in the general short-term recovery of the FTSE100 but also news of a new Chief Exec. The shares were about 60p in January and have recovered after a pandemic slump to about 39p today.
And Rolls-Royce is about 50% cheaper than it was at the beginning of the year. Clearly these guys’ fortunes are largely tied to the aviation sector which is in the doldrums, however I am reliably informed they have a new engine which powers smaller planes and shorter trips, rather than their previous focus on whopping big engines for great big fat planes which cross the globe. (Apologies if my scientific language has lost anyone.) So some people are getting excited.
It is stories like this that make investing so interesting. I have never been a Maths boffin, I don’t like graphs and equations give me headaches. But I do like businesses. And working out what the future holds, what the ‘herd’ will think and how those flashing numbers at the Stock Exchange are simply a summary view of what people think is going on in the world.
If we take markets as a sort of populist gauge of global sentiment, they are telling us that China and the Asia Pacific will bounce back better than Europe after Covid; they show divided opinion about the fate of Britain but a general consensus that we have been too miserable about the long-term future of some home-grown core brands – and a general opinion that the sofa of our own homes (laziness) is more powerful than Pick’n’Mix (greed). It also reflects, not for the first time in the last millennia, that the English like to label the French a ‘major obstacle’ but think when it comes down to the wire that they will beat them.
Finally, if you like have a nose at what everyone else is up to, I like this page on AJ Bell Youinvest which shows the most bought and sold things by day, week and month. It’s a bit of a blackhole and the investor equivalent of Dolly Parton’s cleavage. Extremely hard to stop staring at it and no good will probably come of it, but strangely compelling.
Have a great weekend everyone. I have a new chimenea to fire up as a few of the girls come around for a rather chilly drink on Saturday. I’m making a cocktail I discovered in Finland. You make mulled wine, freeze that into ice cubes, pop a mulled wine ice cube into a champagne glass and top it up with the fizzy stuff. Hard to get cold with one of those in your hands!