No panic selling – savvy investors are hunting bargains

While the market falls yesterday clearly sparked panic among some investors, AJ Bell customers held their nerve and instead went hunting for bargains. While we had the busiest day for log-ins that the platform has ever seen, when we look at what investors are actually doing, more were buying than selling. Looking at data for trading so far this month shows that there have been 2.5 times more buys than sells.

If we look at trading activity just yesterday, oil giants BP and Shell were the most bought stocks by AJ Bell customers. BP saw its share price fall almost 20% yesterday, while Shell saw an 18% fall following the collapse in the oil price. While the dividends of both of these stocks may be put under pressure following the oil price fall, at current valuations the dividend yield looks positive for income-seeking investors.

Other stocks that investors were snapping up include airlines, which have been among the hardest hit during the current market volatility. Investors were buying easyJet and International Consolidated Airlines Group. While both were only down modest amounts yesterday, they have been pummelled since the market volatility began in February, down 29% and 27% respectively, and clearly investors feel like the sell-off has been overdone.

UK finance firms were also top of the buy list for investors, including banking giants Lloyds and Barclays, and insurance groups Aviva and Legal & General. All the companies saw a 10% fall on markets yesterday, adding to already significant falls over the past few weeks.

A number of investment trusts fell to discounts yesterday, which investors snapped up. For example, Scottish Mortgage saw its share price fall 4% yesterday and investors dived in to buy the technology-heavy trust on a discount. City of London was also popular among investors having seen a 6% fall in the day and a near 15% fall in its share price over the market volatility.

Most bought investments on AJ Bell Youinvest, 9 March 2020

Royal Dutch Shell
BP
Lloyds
iShares FTSE 100 ETF
Aviva
Legal & General
Scottish Mortgage IT
Premier Oil
Barclays
Vanguard FTSE 100 ETF

These articles are for information purposes only and are not a personal recommendation or advice. We don't offer advice, so it's important you understand the risks, if you're unsure please consult a suitably qualified financial adviser. The value of your investments can go down as well as up and you may get back less than you originally invested.