Wealth Manager - the site for professional investment managers

Register to get unlimited access to Citywire’s fund manager database. Registration is free and only takes a minute.

Aberdeen slumps as FTSE aims for 2013 high

1 Comment
Aberdeen slumps as FTSE aims for 2013 high

Another asset manager counted the cost of investors’ aversion to emerging markets, with Aberdeen Asset Management (ADN.L) reporting £4.4 billion of outflows to land it at the bottom of a flat FTSE 100 on Thursday.

Aberdeen shares, which have already fallen 10% so far in January, dropped 3.3% to as management told shareholders ‘business flows reflected the continuing negative sentiment towards Asian and emerging markets generally’.

Two days ago rival asset manager Ashmore (ASHM.L) – which is even more focused on emerging markets than Aberdeen – reported net outflows of $3.5 billion from its funds for the same period.

Another investment company, private equity firm SVG Capital (SVI.L), was also suffering on Thursday morning, with shares down 8.6% after the news that Aegon had disposed of £20million worth of shares in the FTSE 250 company.

The UK’s benchmark FTSE 100 managed to cling onto gains made yesterday, up 0.1% at 6,830 and heading for its fifth day of gains. That means the index is zooming in on last year’s high of 6,875 as investors put aside worries over valuations and the tapering of US stimulus.

Mining shares supported the Footsie, with gains of around 3% from BHP Billiton (BLT.L), Fresnillo (FRES.L) and Antofagasta (ANTO.L). Rio (RIO.L) rose 2.8% to £33.46 after beating its targets for cost cutting in 2013 and exceeding expectations for copper production in the last quarter of 2013.

‘Buy’ Rio Tinto shares, says Liberum analyst Richard Knights. ‘The reasons to buy RIO here stem from its best-in-class balance sheet and scope for outperformance on capital management initiatives’, he says.

The strength in resources company shares offset declines in consumer firms, with Associated British Foods (ABF.L) suffering from a 28% decline in sugar sales in the 16 weeks to 4th January. Shares in ABF fell nearly 3% to £26.16 with losses mitigated by another strong performance from its Primark cheap clothing business.

Numis cut its ABF rating from ‘hold’ to ‘sell’. Analyst Charles Pick said: ‘The shares have advanced by 251p or 10.3% this year and look to have run ahead too strongly with profit taking warranted.’

Home Retail’s (HOME.L) performance in the 18 week period to 4th January 2014 was better than the City had expected, lifting shares 3% to 207p. Among the brands owned by the group, Argos store sales rose 3.8%, while Homebase reported a 4.7% rise in like for like sales.

Leave a comment!

Please sign in or register to comment. It is free to register and only takes a minute or two.
Citywire TV
Play Biotech Growth: we will ride out this storm

Biotech Growth: we will ride out this storm

Geoffrey Hsu of Biotech Growth Trust says the sell-off in biotechnology stocks represents a buying opportunity for long-term investors.

Play Picton: the UK property hotspots for rental income

Picton: the UK property hotspots for rental income

Picton Property Income CEO Michael Morris reveals how he is planning to ride the ‘ripple effect’ as UK economic growth spills out from the capital across the country.

Brewin's Foster talks financial crisis MkII with Allianz's Riddell

Brewin's Foster talks financial crisis MkII with Allianz's Riddell

This week Brewin Dolphin's head of research talks to Mike Riddell, fund manager at Allianz Global Investors, about the forces driving bonds markets in a tumultuous week for markets.

Your Business: Cover Star Club

Profile: PortfolioMetrix is on a mission to kill 'Frankenstein' systems

Profile: PortfolioMetrix is on a mission to kill 'Frankenstein' systems

In a buyers’ market for off-the-peg discretionary management, self-funded start-ups begin at an inherent disadvantage

Wealth Manager on Twitter