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What American Funds And Fidelity Bought In Second Quarter

Investors pay a lot of attention to hedge fund filings to see what stocks have been bought and sold, but mutual fund giants American Funds and Fidelity manage much more in assets.

Verizon Communications' (VZ) share count fell 4.2% to 282 million at the end of the second quarter, according to the S&P Capital IQ database and using the June 30, 2016 13-F filing. After increasing its exposure in the prior six quarters, many American Funds reduced stakes in the telco. Meanwhile, the share count in high-dividend-yielding peer AT&T (T) fell 7.6% to 121 million in the June quarter, the second consecutive quarter.

Other high dividend paying positions that were cut in the second quarter by American Funds included Altria Group (MO), Exelon (EXC), and Pfizer (PFE). The share count dropped between 6%-7% for these blue-chips.

Meanwhile, a number of more growth-oriented, non-dividend-paying stocks were bought in the second quarter across the American Funds' portfolios. For example, the share count in life sciences tools & services Illumina (ILMN) rose 16% to 14 million. Capital Research & Management's collective exposure to ILMN has climbed from 8.6 million shares in the past year.

Another such growth stock purchased for American Funds shareholders was Alibaba Group (BABA), the Chinese internet software & services company. The share count rose 6.5% in the second quarter to 56 million and has more than tripled in the past year.

Meanwhile, Fidelity made a number of changes to their information technology holdings. During the second quarter, the share count in Microsoft (MSFT) declined 20% to 122 million. Fidelity's exposure to the systems software company is now lower than it was at the end of the third quarter of 2015, after briefly climbing higher.

a number of more growth-oriented, non-dividend-paying stocks were bought in the second quarter across the American Funds' portfolios
Meanwhile, the share count for tech hardware stock Apple (AAPL) was cut by 6.9% to 128 million and has fallen in the last four quarters. However, Fidelity was a significant buyer of home entertainment software stock Activision Blizzard (ATVI), with the 103 million share count having climbed 92% in the quarter. In February 2016. ATVI completed its purchase of King Digital and reported first and second quarter results ahead of the Capital IQ consensus.

Other stocks that were favored by Fidelity during the second quarter included specialty REIT American Tower (AMT), cable provider Charter Communications (CHTR), and automobile manufacturer Tesla Motors (TSLA). The shares for these three large-caps all increased 20% in the second quarter.

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