Investors dump equities

By MICHAEL CLARKE
Updated: 09:56 EST, 21 August 2006

PRIVATE investors ditched their shares over the summer as the stock market took a downwards turn.

Just under £10bn of equities were sold in the six months to the end of July, but £6bn of that figure was dumped in the two months of June and July alone.

Financial stocks saw the heaviest sell-off, although utilities and industrial stocks also fared badly. There was modest buying of consumer goods, IT and oil and gas shares over the same period.

At the end of July, private investors held £192.3bn worth of shares, the equivalent to 11% of the total market.

John Roundhill, director of Capita Registrars, the company behind the research, said: 'The 600 point fall in the stock market in May and June wiped over £160bn off the value of shares. This gave private investors quite a jolt.

'They may have been using the recent bounce in the stock market as an excuse to trim their holdings and lock in some of the profits they made during their recent bull run.'

Over £1.7bn was taken out of financial stocks, with £1.5bn also withdrawn from the consumer services sector, which includes retail and leisure companies.

There was just £150m worth of net buying in consumer goods stocks, which includes food and drink, and £164m in oil and gas.

Roundhill added: 'Consumer goods companies were the top performing sector and indeed recent reports on retail sales show that food and drink sales have been extremely strong through the World Cup and subsequent heat wave.

'The oil and gas sector is benefiting from the continuing high energy prices too.'