Important information: The value of investments and the income from them, can go down as well as up, so you may get back less than you invest.
THE five stocks most actively-traded equities by Fidelity Personal Investing customers1 have not changed since the start of the year, despite all the global upheaval and lingering economic uncertainty around the pandemic and more recently the war in Ukraine.
Oil and travel dominate, with oil giants BP (BP.) and Shell (SHEL) among the top five stocks most actively-traded by Fidelity customers, alongside British Airways-owner International Consolidated Airlines Group (IAG) and engine maker and servicing group Rolls-Royce (RR.). Lloyds Banking Group (LLOY) completes the top five, where it has remained in first or second spot.
And interestingly, those top five most-active stocks have barely changed from a year ago, when IAG, Rolls-Royce and BP all dominated the top five, alongside GlaxoSmithKline (GSK) and Argo Blockchain (ARB).
It’s fair to assume that inflation, higher interest rates, the Ukraine war, possible stagflation or even recession, will have played on many investors’ minds recently. Analysts at Credit Suisse have Lloyds on a list of 15 stocks they say should fare best in those circumstances; Lloyds specifically for its “good pricing power” and the ability to “pass through any input costs.”
But Lloyds shares have been volatile over the past 12 months. And rising inflation has pros and cons for the banking group. As a result of rising inflation the Bank of England has started to raise interest rates, which does allow Lloyds to charge more when lending to its customers, which is obviously good for its revenue. But, on the flipside, the steep rise in the cost of living could reduce the likelihood of people taking out loans from the bank, which could adversely hit its bottom line.
It’s a similarly mixed picture for the oil majors, BP and Shell.
In the year-to-date, BP's share price has risen by nearly 10%, as bumper 2021 profits and the rising price of oil offsets the fallout from Russia’s war with Ukraine.
But as Q1 or 2022 ends, the company still has a lot on its plate to contend with, from its Rosneft exit, to Brent Crude prices, then there’s its shift to green energy, potential windfall taxes and its general financial outlook; all of which look set to dominate for the rest of the year.
Shell faces much of the same. It has just agreed a joint venture with Germany as it attempts to lower its reliance on pipeline gas from Russia. And according to a LinkedIn post by David Bunch, head of the company's UK operations, Shell plans to invest between £20 billion and £25 billion into the energy system in Britain over the next decade, and over 75% of that money will be funnelled into zero-carbon products and services.
As for travel, the big question hanging over the likes of IAG and Rolls-Royce is both whether the skies stay open and, if they do, whether cash-strapped consumers will take to them and appease some of their pent-up wanderlust.
1 Most actively traded shares on the Fidelity Personal Investing platform from 1.1.22 to 31.3.22.
Important information: Reference to specific securities should not be construed as a recommendation to buy or sell these securities and is included for the purposes of illustration only. When you are thinking about investing in shares, it’s generally a good idea to consider holding them alongside other investments in a diversified portfolio of assets. Investors should note that the views expressed may no longer be current and may have already been acted upon. This information is not a personal recommendation for any particular investment. If you are unsure about the suitability of an investment you should speak to one of Fidelity’s advisers or an authorised financial adviser of your choice.
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