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Investor sentiment swings towards financial services

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Investor sentiment towards the financial services sector has reached its highest level since 2012.

Some 56 per cent of investors are looking to sink money into the sector in the next six months, according to the latest Halifax Share Dealing Market Tracker.  

Energy & mining and consumer & retail products – which includes beverages, health, tobacco and pharmaceuticals – rounded out the top three sectors being targeted by investors.

Damian Stansfield, managing director of Halifax Share Dealing, said: “Short term investor sentiment can be volatile, but the financial services sector is currently attracting a great deal of attention from retail investors. However, there is no substitute for research. As ever, past performance alone is not a reliable indicator of future performance.”

Financial services remains the widest-held sector – 73.7 per cent of investors currently hold these stocks, up from 60 per cent last month. Energy & mining stocks saw an increase of 10.5 percentage points from May to June, with 67.5 per cent of retail investors currently holding stocks in this sector.

Just over half of investors hold stocks in the consumer & retail products sector, compared to 31.8 per cent at the start of the year.

Stansfield said: “There are many different factors to examine when making any investment decision, but the most important thing is that investors satisfy themselves through their research that the investment stacks up.”

Meanwhile, optimism in the FTSE has been dampened by uncertainty surrounding interest rates and tensions in Iraq and Eastern Europe, according to Halifax. Just 44.6 per cent of investors expect the FTSE 100 to be higher at the end of the year, compared to 50 per cent who felt this way last month.

The majority of retail investors said the value of their portfolio has risen over the last six months, while 26.2 per cent said it has remained flat and 12 per cent said it has fallen.


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