Market Report: Just Eat fell below its float price as the tech rout hit sentiment
Wednesday 09 April 2014
Mothercare slumped to a 22-month low yesterday after Cantor Fitzgerald warned the struggling mother and baby retailer is "running out of options".
Over a third of its value was wiped out in January after a profit warning and the surprise departure of chief executive Simon Calver. Investors are hoping tomorrow's fourth quarter report will bring news of a turnaround strategy from replacement Mark Newton-Jones.
But Cantor yesterday said it expects "another poor trading update", adding that "there is room for further downgrades if trading has continued to deteriorate". The broker cut its target price by 25 per cent to 151p. Mothercare was down 9.25p to 162.75p.
Technology stocks continued to take a pummelling worldwide, with two recent market entrants feeling the heat on the Footsie: AO World lost 15p to 280p, while Just Eat, starting unconditional trading, fell below its 260p float price for the first time, off 14p at 250p.
Wider sentiment was dented by the tech rout, with the FTSE 100 losing 32.15 points at 6,590.69. News of Sports Direct founder Mike Ashley selling a 4 per cent stake in the business saw the retailer suffer its biggest one-day decline since December. Sports Direct closed down 82.5p at 811p.
Ashtead, which rents industrial equipment, also suffered a heavy correction, 51.5p lighter at 901p. In a bear market, traders took profit, with the company trading at an all-time high last week.
On the FTSE 250, generic drug maker Hikma Pharmaceuticals flopped 152p to 1,512p after UBS told investors to put the brakes on. The company is trading near UBS's target price.
Office2office revealed US investor Nicholas D Gerber is pushing for a reverse takeover of the group, led by his fund management business and a Bulgarian website developer. Office2office, up 0.5p at 21.25p, said the plan had "no strategic or commercial logic".
AIM-listed gold explorer Hummingbird Resources climbed 2.75p to 58.75p after said it thinks its Dugbe 1 project in Liberia could be "significantly" bigger than first thought.
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