TD Waterhouse most popular trades: Budget Special

Angus Rigby, Chief Executive Officer, TD Waterhouse comments: “No one would argue with the Chancellor’s statement yesterday that it is a time of “great uncertainty”, as he stepped up to deliver his first Budget to the nation. Alistair Darling’s unenviable task came in the midst of economic turmoil brought on by the ongoing global credit squeeze and the increasing cost of energy and food.

“Given this unstable backdrop, discussion centred on a number of significant tax changes that are coming into effect in April this year such as the 2p drop in the basic rate of income tax and the introduction of a flat rate of 18% for Capital Gains Tax.

“Plugged as the ‘Green Budget’, Darling also focused on cutting carbon emissions from homes, businesses and transport. With these issues in mind, our investors have followed suit, casting their attention to the oil and gas sector in the shape of Desire Petroleum, which saw strong trading activity this week. Share price in the Company soared by a third last month, after a deal was signed with a large unnamed development partner to begin oil exploration at an acreage off the Falklands Islands.

“With oil now trading at well over $100 a barrel and speculation that there could be more than 14bn barrels in supply offshore of the islands, shares in the stock have rallied. However, some of our customers appear divided on the stock and have taken profits this week, perhaps concerned by reports that record oil prices are likely to be accompanied by high production costs and expensive transportation from the remote oil rigs. Nevertheless, with petrol duty on everyone’s lips following the Budget, share price in Desire Petroleum ambulance chases, with shares trading up by over 190% this year on last.

“Long-term investors in British Airways eagerly awaited the government’s verdict on airline flight tax which will now be implemented in 2009. Yesterday, Darling confirmed that air passenger duty (APD) will be replaced by a single tax per plane in a bid to cut carbon dioxide emissions. TD Waterhouse customers increased their exposure to the stock this week, despite a slip in shares of 8% this week on last.

“The airline sector has been subject to great public interest of late and it has been further hyped by news that Gatwick and Heathrow will soon face fare rises with an aggressive new price-control regime.

“Investors took profits from Tesco this week after the government delivered a three-line whip on plastic bags, announcing that supermarkets must curb plastic bag usage or risk legislation next year which could force them to issue charges to customers. However this decision could be a case of plastic fantastic for Stanelco which was traded heavily this week, with a ratio of approximately 2:1 for retail buys and sells. The biodegradable packaging group is trading up over 270% on last month after backing Marks & Spencer’s recent campaign against plastic bags.”