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Stocks lifted by last-ditch debt deal optimism
by Chris Marshall on Oct 16, 2013 at 15:35
Britain’s FTSE 100 was trading down 0.5% to 6,518, while the Euro Stoxx 50 was off 0.35%. The gold price edged 0.1% lower to $1,278.
Several companies were still falling after the surprise announcement yesterday that Neil Woodford, Britain’s most powerful fund manager, was stepping down from Invesco Perpetual to start his own fund management firm.
The Edinburgh investment trust that Woodford runs was hit hardest, down another 4.6% to 548p on Wednesday morning. That loss adds to Tuesday’s 5% decline. The company’s board has said it is reviewing future management arrangements.
Drax (DRX.L) was down another 1.7% to 627p, adding to a 3% loss on Tuesday. ‘Given that Drax provides only a modest 2.6% FY14 dividend yield its long term place in a high income portfolio may be questioned as Mr Woodford transitions out of Invesco,’ commented analysts at Liberum.
Capita (CPI.L), the outsourcing giant that was already hit with a 3.6% decline yesterday on news of Woodford’s decision to leave Invesco, was down another 1.7% after the news.
Provident Financial (PFG.L) shares fell 1.8% to £16.25, adding to a 1.6% decline yesterday.
‘With the news that Neil Woodford is quitting Invesco, who are Provident’s largest shareholder with a 25% stake, it is possible that sentiment towards the shares could take a further hit in the near term, owing to fears of an impending sell down of this stake, we think,’ wrote Shore Capital analyst Gary Greenwood in a note to clients. ‘However, fundamentally we believe Provident remains a strong company’
Another Woodford holding, Rentokil (RTO.L), the business services group, fell 0.5% to 107p, adding to a 2.9% decline on Tuesday.
Serco (SRP.L) had been another victim, yesterday dropping 3.9%. But the outsourcing firm was trading 0.7% higher on Wednesday at 519p after analysts at HSBC raised their recommendation to ‘overweight’.
In currency markets, the British pound was up 0.1% at $1.6016 after a report showed the UK unemployment rate remained at 7.7%.
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- Drax Group PLC (DRX.L)
- Capita PLC (CPI.L)
- Provident Financial PLC (PFG.L)
- Antofagasta PLC (ANTO.L)
- Fresnillo PLC (FRES.L)
- Anglo American PLC (AAL.L)
- Rentokil Initial PLC (RTO.L)
- Serco Group PLC (SRP.L)
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On the road
by Danielle Levy on Dec 12, 2013 at 09:03