TD Waterhouse customers look to turn a buck on new stocks

Angus Rigby, Chief Executive Officer, TD Waterhouse comments: "Encouraging pre-clinical and clinical trials of new drugs on the market not only bode well for sufferers of Parkinson's disease, but also for our savvy retail investors who have been tracking recent developments in the pharmaceutical sector. Large pharmaceutical company stocks are traditionally regarded as defensive due to inelastic demand for health care products, but smaller stocks are more popular with adventurous investors. Our customers' recent interest in two small biotech companies suggests they were injecting some risk into their portfolios this week.

"British biotech company Phytopharm made a new entrance in the top ten tables this week after reporting promising early test results with its Parkinson's disease drug Cogane last Wednesday (14 Oct). The pre-clinical test results announcement pushed up the company's share price by an astounding 350% - one the biggest hikes in recent times on the London market. Phytopharm's share price was 308% higher at 25p by 1245 GMT last Wednesday, valuing the business at around £23.5m, after earlier touching a high of 27.75p. The stock, which has entered both top ten tables this week on the back of the single-day fluctuation in its share price, accounts for nearly 8% of the top ten trades at a buy to sell ratio of 1.5 to 1. This directly mirrors the overall top ten buy to sell ratio of trades this week.

"Rival company Oxford BioMedica, a British gene therapy specialist, has also made a new appearance in this week's buys on the back of similar news. The company's share price soared 95% to 21p last Thursday (15 Oct), hitting a 15-month high, when the company announced that patients have responded well to a second dose of ProSavin - also a Parkinson's disease drug. However, it is worth noting that this therapy is potentially complementary to oral products such as Phytopharm's Cogane.

"But overall, this week's top ten trades suggest our customers have been looking to refresh their investment portfolios with new stocks entering the tables from other sectors also. Oil and gas company Nostra Terra is a new entrant in this week's tables with a buy to sell ratio of nearly 2 to 1. The company was the top riser on AIM last week, jumping 15.6% due to further demand on the back of an oil discovery in Kansas in the United States. The stock has continued to rise since the announcement last Tuesday, with its share price reaching its highest level since June last year.

"Finally Punch taverns - the leading British pub group with over 7600 pubs in its leased managed portfolio - has also climbed into this week's top ten buys at sixth place after members of its senior management team were awarded millions of shares in the company to incentivise their performance in the coming years. Under the terms of the group's long term incentive plan Giles Thorley, Punch's chief executive, has been granted 1,1666,666 shares - a ‘conditional award' - at a price of 90p a share. Punch shares were trading at 88.5p on Monday, the lowest the stock has been since April this year, which suggests our customers may have been scooping up good value shares in the hope of future gains."