Banking sector still in the spotlight for TD Waterhouse customers

Angus Rigby, Chief Executive Officer, TD Waterhouse comments: "The FSA's announcement of a new scheme for short selling must have felt like a well-timed breath of fresh air by the banking sector and by HBOS and Barclays in particular. The City regulator's new disclosure regime, which took the market by surprise and comes into force this Friday, is designed to stop market abuse and rules that anyone selling short the stock of a company involved in a rights issue will be required to make a disclosure if the short position amounts to 0.25% or more of the outstanding stock.

"This announcement has already produced a positive effect on HBOS' share price, which was up by more than 25% compared to last week. Meanwhile, Barclays is the latest bank to contemplate raising much needed funds and is mulling its own multi-billion pound cash call by issuing new shares, instead of going down the classic route of asking existing shareholders for more money through a rights issue. This move is deemed to pre-empt hedge funds speculations that could be punitive for the company share price. Both banks are still ranking high in our Top Ten buys and sells this week, together with peers Royal Bank of Scotland, Bradford & Bingley and Lloyds TSB, with the banking sector accounting for 70% of all trades this week.

Appetite for UK house builders hasn't abandoned TD Waterhouse trading investors as Taylor Wimpey and Barratt Developments are firmly kept in our most sold and bought share list this week. Pressure continues to build on Taylor Wimpey, the UK's largest housebuilding group, after its debt was downgraded to junk yesterday by credit-rating agency Fitch Ratings because of the gloomy economic prospects and deteriorating sector operating environment.

Finally, Meldex International has re-entered our Top Ten this week. The stock of the pharmaceutical and healthcare company has been a popular choice among our investors for a number of years. Formerly named Bio Progress, Meldex saw its share price slide last Friday on rumors it was preparing to launch a rights issue, but the stock volatility is also due to the company being at the centre of bid talks since last January, with former Chairman Barry Muncaster thought to be among its suitors.