TD Waterhouse customers hope to turn Lloyds' bad luck into a charm

Angus Rigby, Chief Executive Officer, TD Waterhouse comments: "When Lloyds' share price fell by a staggering 32% on Friday the 13th, TD Waterhouse customers were clearly hoping to take advantage of the volatility to either make a short term profit, or gain by holding the stock for the longer term.

"Indeed, the Black Horse has moved into first place as this week's most popular trade, accounting for 38% of the buys as its share price was battered following reports that its recently acquired subsidiary, HBOS, had made an £11 billion pre-tax loss in 2008. Exceeding expected write-downs by more than £1.6billion, HBOS's loss caused its new parent company's shares to crash by as much as 40% over the week and our customers were quick to snap them up, buying 74% more than last week. In fact, our research shows that TD Waterhouse customers were lapping up seven shares for every single share sold on Friday alone.

"The bank, which is currently 43% state-owned, was dealt a further blow as ratings agency, Moody's downgraded its previously longstanding rating of Aaa to Aa3 sparking new fears the bank will be forced into full nationalisation. Although Lloyd's share price has regained 10% today, it is still only 56.3p at the time of writing.

"Overall, ‘buying on a discount' continued to be the strategy of the week across the top shares, with the number of buys in the tables up 32% on last week as customers dug around for a good deal. However, our customers tempered buying activity (by 34%) in Royal Bank of Scotland (RBS) shares compared to last week. Perhaps this was due to Lloyds' overwhelming popularity, but it could also be in reaction to the state-owned bank's struggle to find the £8billion required to enter the Governments insurance scheme, where it was hoping to re-house £200billion of its toxic assets.

"Bowing to government and public pressure, the bank has slashed employee bonuses to the legal minimum of £175million, although it plans to top it up with a further £600million in bonds.

"Finally, it seems all that glitters isn't gold this week as customers ditch shares in mining companies, which account for 16% of the top ten sells. Shareholders of Rio Tinto, which alone accounts for 5% of the top ten sells, were left feeling disappointed last week following its decision to go ahead with a $12.3billion deal with Chinalco rather than raising a rights issue. However, buys in the mining giant were up 20% more than sells as shares prices nosedived following the controversial deal that will increase Chinalco's stake in Rio Tinto to 18%."