UK share markets have got 2021 off to a strong start. Take the FTSE 100, for instance. Britain’s blue-chip index has risen around 400 points since trading kicked off and even touched levels not seen since late February.
Stock investors clearly need to be careful before buying UK stocks in 2021. The possibility of a long Covid-19 economic hangover could hit shareholder returns this year and beyond very hard. But they shouldn’t stop investing altogether. Here are four top UK shares I’d happily buy in my own Stocks and Shares ISA this year:
#1: Manolete Partners
Insolvency litigation specialist Manolete Partners is a perfect stock for these troubled times. The number of companies experiencing extreme distress unfortunately and inevitably spikes when economic conditions worsen. Indeed, a new Financial Conduct Authority report shows that a mammoth 4,000 City firms face going to the wall in the next 12 months alone. Manolete executed almost three times as many cases between April and September as it did in the same 2019 period. And unsurprisingly its case pipeline continued to grow at a “strong rate”.
#2: CVS Group
Another blowout trading update from Pets at Home last week underlined the strength of the British animal care market. I’ve bought veterinary services provider CVS Group in my ISA to get exposure to this lucrative sector. Both these UK shares underline the lengths Britons will go to keep their pets healthy and happy during even tough economic conditions. CVS’s own like-for-like revenues rose 5.1% during the four months to October as it kept its surgeries open. And the medical business continues to build its estate to boost long-term profits growth.
#3: Barratt Developments
Grabbing a slice of the housebuilding sector is another great idea, in my opinion. I myself own FTSE 100 builders Taylor Wimpey and Barratt Developments to get rich from soaring newbuild home demand. And the latter’s latest financial update this week illustrates why. It said that forward sales were up 14.3% year on year, as of 31 December. It is already 90% forward sold for the financial year ending June 2021. Okay, the end of the stamp duty holiday this April has helped buyer demand in recent months. But UK shares like Barratt have enjoyed strong sales growth even before this fresh government incentive. And they should continue to beyond the spring as low interest rates and Help to Buy continue.
#4: CRH
Building materials supplier CRH is another UK share I have high hopes for in 2021. My bullishness around the FTSE 100 company received a jolt too following developments in Washington this week. With the Democrats seizing control of the Senate, a Joe-Biden-led administration is now free to embark on a gigantic infrastructure plan to shock the US economy back into life. CRH’s resilience in testing times is proven. The 2% rise in underlying EBITDA between January and September is perfect evidence of this. And I expect profits could fly higher from 2021 onwards.
