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Five stocks to buy after the Budget

·4-min read
Rishi Sunak with a pint of beer (illustration)
Rishi Sunak with a pint of beer (illustration)

Chancellor Rishi Sunak has announced £150bn of increased spending in his Autumn Budget that will boost a range of British business and reward savvy investors.

Tax cuts and investment pledges were directed at a number of sectors, including pubs, aviation and housebuilding, with Mr Sunak calling it "the largest cash investment in a decade".

These are the stocks set for the biggest boost.

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JD Wetherspoon

Mr Sunak announced a slew of cuts to alcohol taxes and duties paid by the hospitality sector, which has boosted the share prices of pub and bar chains.

A new "draught relief" will cut duty on beer and cider by 5pc. Due to come into effect in 2023, it will lower the cost of a pint of beer by 3p.

He also cut the "irrational" duty premium of 28pc on sparkling alcoholic drinks, such as prosecco, and introduced a 50pc business rate discount for the hospitality and leisure sector.

Shares in pub companies rose on the day of the announcement. JD Wetherspoon was up 4.7pc, Marston's rose 6.3pc and Mitchells & Butlers climbed 5.9pc.

Richard Hunter, of fund shop Interactive Investor, said: "The alcohol duty cut will benefit the beleaguered pub sector, whose revenues were severely curtailed by the series of lockdowns during the pandemic."


The Government announced spending on large infrastructure projects, including 40 new hospitals, £21bn for roads, £46bn on railways and £5.7bn for city transport infrastructure.

“This budget delivers an infrastructure revolution," Mr Sunak said.

Rob Burgeman, of wealth manager Brewin Dolphin, tipped CRH, a London-listed Irish building materials group, as a beneficiary.

"Building work will be great for CRH shares," he said. "Any increased investment in construction, infrastructure, and roads is good for its business."

CRH has a market value of £26bn and is the biggest building materials firm in America and Europe.

Investors already place a high value on its shares, which trade at 32 times the company's profits versus the average 13 times across Britain's stock market. The stock has risen 10pc this year and yields 2.4pc.


Workman lays bricks on Persimmon construction site - Chris Ratcliffe/Bloomberg
Workman lays bricks on Persimmon construction site - Chris Ratcliffe/Bloomberg

Housebuilding was another area earmarked for government spending. Mr Sunak announced a £11.5bn fund to build up to 180,000 new affordable homes, describing it as "the largest cash investment in a decade, 20pc more than the previous programme".

He also confirmed a £1.8bn brownfield fund, which will help "unlock 1 million new homes".

Mr Burgeman said Persimmon, Britain's leading blue-chip housebuilder, was the most likely beneficiary. Shares in the company rose 2pc after the spending commitments were announced, as did those of rival housebuilders Redrow and Bellway.

Persimmon has a market value of £8.5bn and a large 235p dividend payout this year places the shares on an 8.8pc yield.

Mr Burgeman added that smaller housebuilders could also benefit from the Budget push to increase the supply of homes. He highlighted Scottish builder Springfield Properties, a £1bn business whose shares are relatively cheap, trading at 10 times the company's profits, versus Persimmon's 12 times.


Jet2 passenger plane taxiing - jremes84/Juha Remes
Jet2 passenger plane taxiing - jremes84/Juha Remes

Mr Sunak announced a lower rate of air passenger duty for people flying between England, Scotland, Wales and Northern Ireland from April 2023.

"This will help the cost of living, with nine million passengers seeing their duty cut by half," he said. Regional airports will also receive extended financial support for a further six months.

Emma Wall, of fund shop Hargreaves Lansdown, said: "Changes to air passenger duty have made short-haul flights cheaper but long-haul more expensive, benefiting the budget airlines such as Jet2."

Shares in Jet2, a £2.7bn company, spiked on the announcement before dropping back.


A 50pc increase in research and development spending to £20bn per year, as well as looser visa rules for highly-educated foreigners, will help British life sciences and technology business.

Mr Burgeman said Syncona, an investment trust which owns a portfolio of British healthcare companies, would benefit from an increased commitment to supporting scientific research in Britain.

"The share price may have waned since the exuberance for life sciences and biotech during earlier phases of the pandemic, but many of its holdings have strong prospects – albeit, there could still be bumps along the way," he said.

Ms Wall said another option for investors looking to profit from greater investment in technology was the The Renewables Infrastructure Group, which buys and manages predominantly wind and solar energy generation projects.

She also tipped the Legal & General Future World ESG UK Index fund as a core holding "for broad investments in British stocks which are future leaders in environmental innovation".

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