Retail investors warm to new stocks during the big freeze
Angus Rigby, Chief Executive Officer, TD Waterhouse comments: "The New Year has beckoned new stocks to the top ten trading tables with Desire Petroleum and Rockhopper Exploration edging into the top ten buys at 10th and ninth position, respectively. The two companies are expected to drill up to eight wells this year in the offshore North Falklands Basin, the first in the region since 1998.
"UK based Rockhopper Exploration already holds licenses to explore for oil and gas in the North Falkland Basin, which has two proven petroleum systems and a proven high quality oil source rock. Two wells were drilled during 1998 by Shell, who held the licenses at that time. One recovered live oil, while the other encountered significant quantities of gas. However, the take up in shares may also be explained by Rockhopper issuing an equity placing of 990 new ordinary shares of 1p each at an exercise price of 10 pence per share in December 2009, raising £50 million.
"As we begin a new decade, however, it is the banks that continue to dominate retail investor interest, with 64% of the overall top ten trades and buys just slightly (8%) ahead of the sells. Lloyds Banking Group has emerged as the most popular buy in the first few days of 2010 after the black horse placed $5 billion of notes in a two-part sale. The offering includes $2.25 billion of five year notes priced to yield 182bps over comparable US Treasuries and $2.75 billion of 10 year notes priced to yield 208bps over Treasuries. Lloyds also sits in the top three sells again this week.
"Meanwhile, Royal Bank of Scotland (RBS) is also a popular trading choice at second place in the buys table and first position in this week's top ten sells. Shares in the bank jumped 11% on Tuesday and have gained more than 20% so far this year as investors gained comfort from bullish analyst notes and talk that another bank might buy part of the UK government's 84% stake. RBS stock closed up 3.32 pence, or 11%, at 35.45 pence on Tuesday (5 Jan) following similar gains Monday, after the shares had closed at 29.20 pence on New Year's Eve. Analysts believe the stock was getting a boost from hopes that the beleaguered bank has taken its worst knocks, and that its share price could rise this year as a host of planned asset sales start to come through."