Angus Rigby, chief executive officer at TD Waterhouse, reflects on retail trading activity in May.

The top ten trades during May resumed a slightly calmer pace after the frenzy we saw in April, when daily trading volumes soared by 42 per cent. However, buy trades strengthened their lead as they outnumbered the number of sell trades by almost two to one (43 per cent), showing that our customers may have been taking the opportunity to buy up shares at prices they felt were discounted in May. 

Banking shares held their position as the most heavily traded sector with more than two-thirds of the top ten (67 per cent). Combining the buy and sell trades for each company revealed that RBS was the most heavily traded stock in May, accounting for a quarter of all trades (25 per cent). The volume of buy trades in the bank was more than double that of sells, as its share price steadily fell over the month on the back of its £44 million loss in the first quarter of the year with debts reaching £5 billion.

The proportion of buys in the mining sector during May was 14 per cent lower than in April. Meanwhile, mining sells in May rose 19 per cent on the previous month’s figure. Customers may have been looking to take profits on the back of rising prices.  

Xstrata accounted for almost half of all mining trades (46 per cent), with buys in the company 21 per cent higher than sells. The mining giant accounted for 53 per cent of the top ten mining buys and 39 per cent of the top ten mining sells. Earlier in May, the miner claimed to have strengthened its financial position during the first quarter following the success of its rights issue while also increasing its commodity production.

The insurance sector, which enjoyed a surge in trading activity in April, fell back to normal levels in May – 29 per cent down on April’s frenzy. Insurance buy trades were nine per cent higher than sells, as May’s figures fell 17 per cent and 40 per cent on April’s buys and sells, respectively. 

May’s trades of Taylor Wimpey stock dropped by more than a third (38 per cent) on its April figures, although buys continued to climb, staying decidedly ahead of sells by 45 per cent. Customers may have been snapping up shares in the heavily indebted house-builder after it issued a discounted share placing and open offer to raise more than £500 million in early May.

Finally, telecoms giant Vodafone dialled into fourth place of the top ten buys, becoming the highest-ranking non-banking buy. Active buying may be down to the mobile phone operator’s plunge in share price, after full-year results to March revealed a 53.5 per cent fall in pre-tax profit to £4.2 billion, causing the firm to ramp up its cost-cutting plans in order to save £650 million by March next year.