Last checked at LONDON (Alliance News) - The following stocks are the leading risers and fallers within the main London indices on Tuesday.
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FTSE 100 - WINNERS
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British American Tobacco, up 1.5%, Imperial Brands, up 0.6%. The two tobacco giants were benefiting from price target upgrades by US investment bank Goldman Sachs. Goldman pushed its target price on BAT up to 5,340 pence from 5,185p and on Imperial Brands to 4,250p from 4,170p. BAT also benefited from a target price upgrade from Swiss bank UBS, to 5,300p from 4,600. BAT was trading at 4,979p and Imperial at 4,074p Tuesday.
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FTSE 100 - LOSERS
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Legal & General Group, down 6.9%. Investment bank Jefferies downgraded the life insurer and investment manager to Hold from Buy.
Whitbread, down 5.2%. Barclays downgraded the Premier Inn and Costa Coffee owner to Underweight from Overweight. The bank previously said Whitbread would be among the leisure stocks most negatively affected by the Brexit vote due to its exposure to business investment. However, Barclays now sees further downside risks for the company given the significant cuts the bank has made to its business investment growth assumptions for the UK following the referendum.
Persimmon, down 5.3%. The housebuilder sounded a note of caution about the uncertainty caused by the Brexit vote for the UK's new homes market, despite reporting higher house sales at higher prices for the first half. Persimmon said it remains committed to building the new homes across the country that Britain needs, and said it "remains too soon to judge the effect that the result of the EU Referendum will have on the UK new homes market". Other housebuilders were also trading lower thanks to the Brexit-related cloud of uncertainty over the sector, with Berkeley Group Holdings down 5.6%, Taylor Wimpey down 5.3% and Barratt Developments down 5.3%.
Land Securities Group, down 4.8%, British Land Co, down 4.1%. Having suffered ratings downgrades on Monday from Liberum, the property developers were both downgraded on Tuesday to Hold from Buy by Societe Generale. The French bank argued the Brexit comes at a time when the UK property cycle looks set to reverse "under a fast-rising speculative supply". While the final outcome for the sector is "unpredictable", SocGen said the past two cycles and rental value forecasts from the bank suggest property prices could fall 25% peak-to-trough in this downturn and share prices of companies in the sector could have around 19% "to give back". The property sector was further shaken by news that Standard Life, the blue-chip life insurer and investment manager, had halted redemptions from its large commercial property fund following outflows in the wake of the Brexit vote. Standard Life shares were down 4.6%, also driven by a price target cut from Jefferies.
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FTSE 250 - WINNERS
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Tate & Lyle, up 0.3%. Amid few risers among mid-cap stocks, sugar and sweeteners producer Tate & Lyle was benefiting somewhat from price target hikes from Societe Generale, up to 780p from 700p, and from Citigroup, up to 750p from 680p. The stock was trading at 684.57p.
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FTSE 250 - LOSERS
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Pets at Home Group, down 8.1%. Liberum double-downgraded the pet products and services retailer to Sell from Buy, saying near-term risks for the company have increased. Pets at Home's results for the year to March 2016 suggested revenue could prove more volatile than anticipated and margin expansion has likely been pushed further out for the company. Before any further substantial gains are made, Liberum said it sees more downside risks for the shares which are not reflected in its current price.
St Modwen Properties, down 8.1%. The property developer said its pretax profit in the first half fell year-on-year despite revenue rising and the company said will take a cautious stance on development following the Brexit vote. "Following the referendum held on June 23, we are now operating in a period of uncertainty in relation to many factors that impact the property market. Whilst it is too early to accurately predict how the UK property market will respond, until we have more clarity we believe it is appropriate to take a more cautious approach to the delivery of our development strategy," said Chief Executive Bill Oliver. St Modwen's pretax profit for the six months ended May 31 was GBP35.5 million, down from GBP180.2 million posted for the same period a year earlier.
Amec Foster Wheeler, down 7.7%. The oil services company was downgraded to Neutral from Buy by US bank Citigroup. This offset any gains the company have enjoyed from the news it has started work on an engineering, procurement and construction contract at Trimble County in the US state of Kentucky. Amec Foster Wheeler is taking on the contract with Louisville Gas & Electric Co and Kentucky Utilities and will work on transitioning the Trimble County Generating Station's coal combustion residuals processing from a wet system to a new closed pipe dry conveyor system.
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MAIN MARKET AND AIM - WINNERS
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TechFinancials, up 13%. The firm said trading has been in line with market expectations, and it has seen continued momentum in demand for its services. The company, which provides technology to financial trading brokers, said both its business-to-business and business-to-consumer divisions have been performing well in 2016, and trading overall is in line with market expectations. Chairman Christopher Bell, in a statement to the company's annual general meeting, said the company's B2B business has gained momentum and has signed five software contracts in the last five months, amid a general increase in demand for its services.
Mariana Resources, up 9.4%. The miner said it has received further high-grade mineralisation intercepts from drilling work at the Hot Maden gold-copper project in Turkey. Mariana said the intercepts included gold mineralisation of up to 68.1 grams per tonne and copper grades of 3.77% in the HTD-60 drill hole at the site. Further high-grade intercepts were found in the HTD-62, HTD-58 and HTD-61 holes at the project. An updated mineral resource estimate for the Hot Maden project is now well-advanced, the company said, and is set to be completed this month.
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MAIN MARKET AND AIM - LOSERS
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Gulf Marine Services, down 15%. The support vessels provider said two contracts with clients in the Middle East have been terminated due to those clients seeking cost efficiencies as a result of the "challenging low oil price environment". Gulf said one contract was with a national oil company for a large class self-propelled self-elevating support vessel which operated as a static accommodation unit. The vessel is expected to come off charter in the fourth quarter of 2016. A contract for a small class vessel with another client has also been terminated, with this charter ending in the third quarter, while a two-year option period on another small class vessel has not been exercised by the same client.
DX Group, down 9.6%. The parcels, mail and logistics company said the UK's Competition & Markets Authority is reviewing its acquisition of The Legal Post (Scotland) and First Post. DX struck a deal to acquire the pair from First Scottish Group for GBP3.3 million in cash in May. Legal Post provides document exchange and postal services in Scotland, while First Post operates a mail service in Scotland competing with Royal Mail. DX said it is now engaged in a consultation with the CMA, the UK's competition regulator, and will make a further announcement in due course.
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By Sam Unsted; samunsted@alliancenews.com; @SamUAtAlliance
Copyright 2016 Alliance News Limited. All Rights Reserved.
30 Jan 2023 12:14
LONDON MARKET MIDDAY: Stocks fall ahead of busy week for central banks
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