Best stocks to own during the last tax year

Investors who bought these stocks could have made incredible profits over the past 12 months, says our City expert.

Early bird investors who used some of their £20,000 ISA allowance to buy GlaxoSmithKline (LSE:GSK), Glencore (LSE:GLEN) or Shell (LSE:SHEL) shares will be sitting on gains of between 32% and 77% today.

The wider FTSE 100 index also rose by 11.6% over the 2021-22 tax year, a figure that compares favourably with another year of ultra-low cash savings rates. These are gains out of HMRC’s reach, further highlighting the wisdom of not waiting until the last moment before utilising annual ISA allowances.

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There were also share price rises of more than 100% for FTSE All-Share quartet Riverstone Energy (LSE:RSE), Investec (LSE:INVP), Indivior (LSE:INDV) and Drax (LSE:DRX), while a further 33 AIM-listed stocks more than doubled in value over the 2021-22 tax year.

This list was led by Brazilian fertiliser business Harvest Minerals (LSE:HMI) with a jump of 487%, with the junior market’s other tax year high-fliers including Serica Energy (LSE:SQZ), Next Fifteen Communications (LSE:NFC) and Shoe Zone (LSE:SHOE).

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Share prices can move both ways, of course, with a turbulent year of cost pressures and interest rate expectations offsetting the global economy’s progress after Covid-19.

Royal Mail (LSE:RMG), Barratt Developments (LSE:BDEV) and ITV (LSE:ITV) were down by a third and Flutter Entertainment (LSE:FLTR) and Ocado (LSE:OCDO) fell by more than 40% as City traders rotated away from growth stocks.

Other popular London-listed companies posting hefty losses of 50% or more in 2021-22 included AO World (LSE:AO.)Capita (LSE:CPI), Avon Protection (LSE:AVON) and Cineworld (LSE:CINE).

These performances are based on only two fixed points in time and lots of other share prices will have spiked and generated excitement across a different period of time.

This was the case in the mining and energy sectors after the Ukraine war triggered an unprecedented surge in oil and other commodity prices. As we revealed yesterday, shares in Glencore (LSE:GLEN) and Anglo American (LSE:AAL) rose by more than 30% in the first quarter of 2022 and copper miner Antofagasta (LSE:ANTO)and iron ore-focused Rio Tinto (LSE:RIO) by 25%.

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In the case of Glencore, however, the share price progress goes back much further as its increased shareholder distributions helped the mining and commodities trader to generate the biggest blue-chip gain of the tax year at 77%.

De Beers owner Anglo American rose 39.4% and Shell lifted 56.5%, which easily outpaced the 27.7% improvement of UK-listed rival BP (LSE:BP.). The list of biggest risers over the tax year showed a leaning towards defensive stocks, a trend that has helped the UK market to outperform other global indices so far in 2022.

Healthcare giants AstraZeneca (LSE:AZN) and GlaxoSmithKline rose 44% and 32% respectively, while utilities businesses National Grid (LSE:NG.) and Severn Trent (LSE:SVT) improved 38% and 37%.

HSBC (LSE:HSBA) was the only bank among the tax year’s top 25 FTSE 100 stocks as higher interest rate expectations were offset by growth downgrades resulting from higher commodity prices. Other popular blue-chip stocks on the list of best performers included BT Group (LSE:BT.A), Tesco (LSE:TSCO) and Diageo (LSE:DGE), with gains of 20% and more.