Market Report: BSkyB picture dimmed as the analysts tune out

 

The Footsie may have reached a five-month high last night, but punters were switching off BSkyB amid claims the satellite broadcaster has fallen out of touch with the great British public. The group has become increasingly friendless in the Square Mile, and yesterday it dropped another 23p to 666.5p after Bernstein Research's Claudio Aspesi became the fourth analyst in a matter of days to hit it with a downgrade.

Mr Aspesi's decision to cut his advice to "underperform" was particularly notable, given it is the first time he has turned negative on BSkyB. Pointing to the recent success of BT (down 0.8p to 203.1p) and Virgin Media in signing up customers to superfast fibre broadband, the analyst said BSkyB was complacent over the threat from the technology, which raised "the question of whether [it] has lost sight of what the market really wants".

Slashing his target price by a huge 41 per cent to 500p, he also fretted over recent reports claiming the group could face more competition for the rights to show Premier League football as well as the possibility the Competition Commission may force changes to the number of exclusive films it can show on its Sky Movies channels.

The subsequent fall left BSkyB shares at their lowest since October, continuing a tough 2012 in which it has already shed more than 9 per cent. Last week UBS, Citigroup and Investec removed their "buy" ratings, with the former warning that the group may end up paying a significant amount more for Premier League rights.

Overall, the FTSE 100 was lifted 38.78 points to 5,741.15 – a level it hasn't closed at since last summer. The rally was all about the banks, with Barclays gaining the top spot by surging 20.25p, or 10.07 per cent, to 221.3p while Royal Bank of Scotland and Lloyds were not far behind, climbing 2.22p to 27.05p and 2.68p to 32.27p respectively.

While positive figures from their peers across the Atlantic – including Bank of America – helped, rising sentiment over the eurozone also did its part. It meant stocks in the wider financial sector were going well, including Aviva, which finished 17p stronger at 342p as takeover speculation around the insurer refused to die.

The news that India's Supreme Court will pass judgement today on Vodafone's appeal against a $2.2bn (£1.4bn) tax bill caused some jitters around the mobile telecoms giant. It dipped 0.55p to 174.65p while its European peer Deutsche Telekom was the subject of vague rumours it could become a target for China Mobile.

There are less than six weeks to go until the start of legal proceedings against BP, but Morgan Stanley's Martijn Rats said there was as much as an 80 per cent chance the oil giant could agree a settlement with the US Department of Justice before the trial begins.

However, he warned this would be likely to involve a fine of up to $25 billion for BP – a much higher sum not only than what the City is expecting but also what the company itself has made provisions for – yet BP still crept up 1.05p to 482.45p.

Tesco outperformed its fellow blue-chip supermarkets by charging up 6p to 327p after the news that US billionaire Warren Buffett has raised his stake in the retailer to more than 5 per cent following its recent profits warning.

Takeover talk around Invensys was being reheated yet again, with US giant General Electric put forward as a possible bidder this time. The suggestion was made by Credit Suisse's Julian Mitchell, who said the mid-tier engineer – which was 15.9p better off at 200p – "would fit well with GE's portfolio of assets".

Heritage Oil bumped up 8p to 192p as market gossips revived familiar bid speculation, but traders were instead highlighting improving sentiment towards its operations in the Kurdistan region of Iraq.

Talvivaara's fantastic run continued, with the nickel miner jumping up another 19.3p to 358.3p. Earlier in the week, the Finnish government's investment arm raised its stake in the company – whose share price rose 80 per cent in 2011 alone – to more than 11 per cent.

The mid-tier index's gold medal position went to Dixons Retail after the electricals chain moved 1.72p higher to 13.55p, meaning it has gained more than a third in the three days since releasing its Christmas sales figures.

The punters were once again getting excited over Rockhopper as the Falkland Islands-focused explorer powered up 10.75p to 327.25p on AIM. The latest vague speculation claimed it could be nearing a farm-in agreement with a US company, although dealers were treating the whispers with a large pinch of salt.

Meanwhile, President Petroleum –which is searching for black gold a bit further west in Argentina – spurted ahead 13.67 per cent to 39.5p after striking oil.

News
people
Arts and Entertainment
'New Tricks' star Dennis Waterman is departing from the show after he completes filming on two more episodes
tvOnly remaining original cast-member to leave crime series
Sport
Frank Lampard and his non-celebration
premier leagueManchester City vs Chelsea match report from the Etihad Stadium
Sport
premier league
PROMOTED VIDEO
Sport
Mario Balotelli celebrates his first Liverpool goal
premier leagueLiverpool striker expressed his opinion about the 5-3 thriller with Leicester - then this happened
News
people'I hated him during those times'
News
Britain's shadow chancellor Ed Balls (L) challenges reporter Rob Merrick for the ball during the Labour Party versus the media soccer match,
peopleReporter left bleeding after tackle from shadow Chancellor in annual political football match
Arts and Entertainment
Female fans want more explicit male sex in Game of Thrones, George R R Martin says
tvSpoiler warning: Star of George RR Martin's hit series says viewers have 'not seen the last' of him/her
News
i100
News
Dame Vivienne Westwood has been raging pretty much all of her life
peopleMemoir extracts show iconic designer 'felt pressured' into going out with Sex Pistols manager
News
ebooksAn unforgettable anthology of contemporary reportage
Life and Style
fashionAlexander Fury's Spring/Summer 2015 London Fashion Week roundup
Arts and Entertainment
Lauryn Hill performing at the O2 Brixton Academy last night
musicSinger was more than 90 minutes late on stage in Brixton show
News
i100
News
Rumer was diagnosed with bipolarity, attention deficit hyperactivity disorder and post-traumatic stress disorder: 'I was convinced it was a misdiagnosis'
peopleHer debut album caused her post-traumatic stress - how will she cope as she releases her third record?
News
people''Women's rights is too often synonymous with man-hating'
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Senior BA - Motor and Home Insurance

£400 - £450 Per Day: Clearwater People Solutions Ltd: **URGENT CONTRACT ROLE**...

Market Risk & Control Manager

Up to £100k or £450p/d: Saxton Leigh: My client is a leading commodities tradi...

SQL Developer - Watford/NW London - £320 - £330 p/d - 6 months

£320 - £330 per day: Ashdown Group: The Ashdown Group have been engaged by a l...

Head of Audit

To £75,000 + Pension + Benefits + Bonus: Saxton Leigh: My client is looking f...

Day In a Page

Scottish referendum: The Yes vote was the love that dared speak its name, but it was not to be

Despite the result, this is the end of the status quo

Boyd Tonkin on the fall-out from the Scottish referendum
Manolo Blahnik: The high priest of heels talks flats, Englishness, and why he loves Mary Beard

Manolo Blahnik: Flats, Englishness, and Mary Beard

The shoe designer who has been dubbed 'the patron saint of the stiletto'
The Beatles biographer reveals exclusive original manuscripts of some of the best pop songs ever written

Scrambled eggs and LSD

Behind The Beatles' lyrics - thanks to Hunter Davis's original manuscript copies
'Normcore' fashion: Blending in is the new standing out in latest catwalk non-trend

'Normcore': Blending in is the new standing out

Just when fashion was in grave danger of running out of trends, it only went and invented the non-trend. Rebecca Gonsalves investigates
Dance’s new leading ladies fight back: How female vocalists are now writing their own hits

New leading ladies of dance fight back

How female vocalists are now writing their own hits
Mystery of the Ground Zero wedding photo

A shot in the dark

Mystery of the wedding photo from Ground Zero
His life, the universe and everything

His life, the universe and everything

New biography sheds light on comic genius of Douglas Adams
Save us from small screen superheroes

Save us from small screen superheroes

Shows like Agents of S.H.I.E.L.D are little more than marketing tools
Reach for the skies

Reach for the skies

From pools to football pitches, rooftop living is looking up
These are the 12 best hotel spas in the UK

12 best hotel spas in the UK

Some hotels go all out on facilities; others stand out for the sheer quality of treatments
These Iranian-controlled Shia militias used to specialise in killing American soldiers. Now they are fighting Isis, backed up by US airstrikes

Widespread fear of Isis is producing strange bedfellows

Iranian-controlled Shia militias that used to kill American soldiers are now fighting Isis, helped by US airstrikes
Topshop goes part Athena poster, part last spring Prada

Topshop goes part Athena poster, part last spring Prada

Shoppers don't come to Topshop for the unique
How to make a Lego masterpiece

How to make a Lego masterpiece

Toy breaks out of the nursery and heads for the gallery
Meet the ‘Endies’ – city dwellers who are too poor to have fun

Meet the ‘Endies’ – city dwellers who are too poor to have fun

Urbanites are cursed with an acronym pointing to Employed but No Disposable Income or Savings
Paisley’s decision to make peace with IRA enemies might remind the Arabs of Sadat

Ian Paisley’s decision to make peace with his IRA enemies

His Save Ulster from Sodomy campaign would surely have been supported by many a Sunni imam