Market Report: Force is not with Vodafone in the US

There was a time when some were calling for Vodafone to get out of Verizon Wireless. The critics have been pacified somewhat by the mobile phone giant's US joint venture paying a multibillion-dollar dividend, but yesterday the City was fretting over the possibility that Vodafone's partner in the business may want it out.

As the 55 per cent shareholder, Verizon Communications is the parent company of Verizon Wireless and controls the purse strings. It approved a dividend payment worth £2.8bn to Vodafone last year, but Jefferies' Jerry Dellis believes expectations that such a windfall will be regular are too high.

While the analyst admitted the two companies "emphasise good relations", he added that "their strategic interests … are ultimately in conflict".

"We believe that Verizon Communications would still ideally like to gain full control of Verizon Wireless in due course," he said, adding that this would be more expensive while Vodafone's share price was strong. As a result, he argued, a "rational decision" might be for Verizon Communications to either hold or trim Verizon Wireless' payouts.

Claiming Vodafone's investors are underestimating this risk, Mr Dellis downgraded his advice from "buy" to "hold". The scribe also warned it was at risk of a step-up in competition from rivals in ex-growth markets, as the group – whose recent adverts have starred Yoda – slipped 1.55p to 179.25p.

In fact it was one of just four blue-chip fallers as the FTSE 100 ended the month on a high. Traders were pleasantly surprised to awake yesterday to news of a deal being reached by EU leaders in Brussels, and the benchmark index went on to jump up 78.09 points to 5,571.15.

Those missing out included Pennon, which was making its Footsie debut after coming in for the energy group International Power. With investors moving away from defensive stocks, the water group shifted back 15p to 762p, despite analysts at UBS calling it the "most likely M&A candidate" in the sector.

Also behind was Barclays, as the continuing fallout from the Libor scandal pushed it down another 2.75p to 162.85p. Rivals Royal Bank of Scotland and Lloyds, however, rebounded 8.9p to 215.3p and 1.16p to 31.1p.

Ahead of an expected vote last night by US politicians on a hard-fought agreement on funding for roads, CRH raced up 84p to 1,232p. Spending on infrastructure in the States contributes a large chunk of the building materials group's profits.

On the FTSE 250, Ocado was once again stuck in reverse. The online grocer was knocked back another 1.8p to 77.7p, meaning the stock has lost 28 per cent since Tuesday's interim results, after Goldman Sachs – which helped to bring it to market at a price of 180p – decided to remove it from their "pan-Europe buy list" and downgrade their advice to "neutral".

It was not the only Goldman float in a spot of bother – Promethean World, whose IPO was priced at 200p, plummeted to a new all-time low on the small-cap index. It dropped 12.75p to 22p after its latest profit warning, which was blamed on a lack of demand for its interactive whiteboards.

Meanwhile, Betfair – another floated by Goldman – did advance 13p to 748p following the release of its preliminary results. However, the betting firm remains nowhere near its 1300p issue price.

A cut to its production forecast, thanks partly to a lack of equipment availability, meant Avocet Mining slumped a huge 60.75p to 90.05p. It was a different story for fellow gold digger Allied Gold Mining which powered up 48.5p to 140p on small-cap index after agreeing to be snapped up by Australia's St Barbara.

Punters' favourite Gulf Keystone Petroleum managed to move off a seven-and-a-half month low by spurting up 21.27p to 163.5p on Aim. Despite its recent weakness the Kurdistan-focused explorer still has plenty of fans, with Fox Davies' Steve Asfour – who is one of those who thinks it could become a takeover target – saying its valuation was "incredibly attractive, and really does place them on the 'wanted' list for any serious players out there".

Suggested Topics
PROMOTED VIDEO
Life and Style
Could you tell the difference between this and an organic alternative?
food + drink

Culinary experts in The Netherlands thought it was 'fresh' and 'tasty'

Life and Style
Six of the 76 Goats' cheese samples contained a significant amount of sheep's cheese
food + drink
News
Russell Brand arriving for the book launch in East London
peopleRussell Brand cancels his book launch debate due to concerns about the make-up of the panel
Arts and Entertainment
JK Rowling will not be releasing a 'romance' novel anytime soon
books
Arts and Entertainment
Contestants during this summer's Celebrity Big Brother grand finale
tvBroadcaster attempts to change its image following sale to US
Life and Style
tech

Of all the computers Apple has ever made there’s only one that Steve Jobs had to sell his car to finance

News
ebooksAn unforgettable anthology of contemporary reportage
Arts and Entertainment
Sarah Dales attempts to sell British Breeze in the luxury scent task
tvReview: 'Apprentice' candidates on the verge of tears as they were ejected from the boardroom
News
One of the 'princesses' in the video
videoYouTube reinstates sweary video after takedown for 'violating terms'
News
Call me Superman: one of many unusual names chosen by Chinese students
newsChinese state TV offers advice for citizens picking a Western moniker
Arts and Entertainment
film

Marvel has released first teaser trailer week early after it leaked online

Arts and Entertainment
Awesome foursome: Sam Smith shows off his awards
music22-year-old confirms he is 2014’s breakout British music success
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

IT Systems Business Analyst - Watford - £28k + bonus + benefits

£24000 - £28000 per annum + bonus & benefits: Ashdown Group: IT Business Syste...

Trainee Recruitment Consultant - Birmingham - Real Staffing

£18000 - £23000 per annum + Commission: SThree: The SThree group is a world le...

Trainee Recruitment Consultant Birmingham

£18000 - £23000 per annum + Comission: SThree: The SThree group is a world lea...

Trainee Recruitment Consultants

£20000 - £25000 per annum + OTE £Competitive: SThree: SThree Group and have be...

Day In a Page

How could three tourists have been battered within an inch of their lives by a burglar in a plush London hotel?

A crime that reveals London's dark heart

How could three tourists have been battered within an inch of their lives by a burglar in a plush London hotel?
Meet 'Porridge' and 'Vampire': Chinese state TV is offering advice for citizens picking a Western moniker

Lost in translation: Western monikers

Chinese state TV is offering advice for citizens picking a Western moniker. Simon Usborne, who met a 'Porridge' and a 'Vampire' while in China, can see the problem
Handy hacks that make life easier: New book reveals how to rid your inbox of spam, protect your passwords and amplify your iPhone

Handy hacks that make life easier

New book reveals how to rid your email inbox of spam, protect your passwords and amplify your iPhone with a loo-roll
KidZania lets children try their hands at being a firefighter, doctor or factory worker for the day

KidZania: It's a small world

The new 'educational entertainment experience' in London's Shepherd's Bush will allow children to try out the jobs that are usually undertaken by adults, including firefighter, doctor or factory worker
Renée Zellweger's real crime has been to age in an industry that prizes women's youth over humanity

'Renée Zellweger's real crime was to age'

The actress's altered appearance raised eyebrows at Elle's Women in Hollywood awards on Monday
From Cinderella to The Jungle Book, Disney plans live-action remakes of animated classics

Disney plans live-action remakes of animated classics

From Cinderella to The Jungle Book, Patrick Grafton-Green wonders if they can ever recapture the old magic
Thousands of teenagers to visit battlefields of the First World War in new Government scheme

Pupils to visit First World War battlefields

A new Government scheme aims to bring the the horrors of the conflict to life over the next five years
The 10 best smartphone accessories

Make the most of your mobile: 10 best smartphone accessories

Try these add-ons for everything from secret charging to making sure you never lose your keys again
Mario Balotelli substituted at half-time against Real Madrid: Was this shirt swapping the real reason?

Liverpool v Real Madrid

Mario Balotelli substituted at half-time. Was shirt swapping the real reason?
West Indies tour of India: Hurricane set to sweep Windies into the shadows

Hurricane set to sweep Windies into the shadows

Decision to pull out of India tour leaves the WICB fighting for its existence with an off-field storm building
Indiana serial killer? Man arrested for murdering teenage prostitute confesses to six other murders - and police fear there could be many more

A new American serial killer?

Police fear man arrested for murder of teen prostitute could be responsible for killing spree dating back 20 years
Sweetie, the fake 10-year-old girl designed to catch online predators, claims her first scalp

Sting to trap paedophiles may not carry weight in UK courts

Computer image of ‘Sweetie’ represented entrapment, experts say
Fukushima nuclear crisis: Evacuees still stuck in cramped emergency housing three years on - and may never return home

Return to Fukushima – a land they will never call home again

Evacuees still stuck in cramped emergency housing three years on from nuclear disaster
Wildlife Photographer of the Year: Intimate image of resting lions claims top prize

Wildlife Photographer of the Year

Intimate image of resting lions claims top prize
Online petitions: Sign here to change the world

Want to change the world? Just sign here

The proliferation of online petitions allows us to register our protests at the touch of a button. But do they change anything?