Market Report: Metal fatigue sees Russians exit FTSE

The Russian gold miner Polymetal gave one last push to hang on to blue-chip status yesterday, but despite a 1.7 per cent rally, it failed. Polymetal joins a fellow Russian metals group, the steel maker Evraz, who will both shuffle out of the top pack. Last night was the cut-off point for the FTSE Group to declare who is in and who is out of this quarter's reorganisation.

The disappearance of the Russians from the benchmark index after only two years was largely caused by the fall in metal prices. But it also marks a change from what was once a trend for foreign-owned businesses to list on London's benchmark index.

It had previously been thought there would be a rush of companies to London, but this has tailed off, and others have faced corporate governance issues, such as ENRC, which is currently the subject of a move to take it private by the company's majority shareholders – the consortium has until 24 June to make a bid.

Yesterday Polymetal added 11p to 628p and Evraz was 3.6p worse off to 113.75p.

While it was do svidaniya to Polymetal and Evraz, the FTSE Group welcomed the housebuilder Persimmon, 9p worse off at 1,205p, and builders' merchant Travis Perkins, up 12p to 1,538p, to the big league.

The stocks will start trading in their new homes on 24 June.

Across the wider market, concerns on Greece and aborted mergers and acquisitions (M&A) meant the FTSE 100 failed to hang on to early gains and finished the day down 40.63 points on 6,299.45.

The biggest disappointment to traders was Severn Trent after the Longriver consortium, led by Canadian and Kuwaiti investors, abandoned its £5.3bn bid for the utilities group. The consortium, which increased its bid three times during its month-long courtship, complained of a lack of communication between the two parties, and investors punished the board for its perceived lack of engagement – it trickled down 172p to 1,765p.

Some short sellers looked as if they had managed their positions during the flow of news on the bid. David Lewis, EMEA head of SunGard Astec Analytics, said: "As Longriver seems to have dropped their bid for Severn Trent it seems some of the short sellers have managed to recoup some of their losses. Shares on loan dropped to around 1 per cent of their peak balance when the bid was in full flow and the share price soared, but as the market sensed that interest from Longriver was starting to dry up balances on loan went up tenfold on 6 June just ahead of the one-month high of £20.70."

HSBC's analysts then poured cold water on further bid talk in the sector and said "the UK water M&A window appears to have closed".

That didn't stop some traders gossiping that there could still be interest from Abu Dhabi in the mid-cap water group Pennon. But it was 1.5p weaker at 660.5p.

BSkyB got a boost after speculation that Rupert Murdoch may again try to take over the broadcaster. Commentators think Mr Murdoch will be well-placed to gain full control once the split-up of his firm News Corp is complete. BSkyB soared 10.5p to 788.5p.

Vodafone dragged the market down after saying it had approached the German cable operator Kabel Deutschland to discuss a bid. Vodafone, which went ex-dividend yesterday, was cut off by 11p to 181p.

Royal Bank of Scotland edged back 1.9p to 325.6p and after the market closed the chief executive, Stephen Hester, announced his departure by the end of the year.

Last week the comparison site MoneySupermarket said it would pay out £70m in a special dividend. Yesterday the broker Canaccord Genuity issued a buy note with a 213p price target and said: "The impact of the £70m special dividend was somewhat diluted by the news that founder/non-exec deputy chairman Simon Nixon is selling 100m shares," but the brokers still think it looks "attractive for a structural growth story, with a strong brand". But the shares declined 14.7p to 183.8p.

The Aim tiddler Berkeley Minerals said it had bought a copper-processing plant in Zambia, with production expected in the third quarter. It put on 0.02p to 2.4p.

The engineering materials group Versarien joined Aim yesterday, and unveiled the acquisition of Total Carbide. Its shares rose 0.5p to 13.5p.

The communications group Creston produced a solid set of full-year results and Liberum Capital rates it a buy. The group broadcast a 4.5p gain to 97.5p.

Start your day with The Independent, sign up for daily news emails
Arts and Entertainment
Wolf (Nathan McMullen), Ian (Dan Starky), The Doctor (Peter Capaldi), Clara (Jenna Coleman), Santa Claus (Nick Frost) in the Doctor Who Christmas Special (BBC/Photographer: David Venni)
tvOur review of the Doctor Who Christmas Special
News
peopleIt seems you can't silence Katie Hopkins, even on Christmas Day...
Arts and Entertainment
Left to right: Stanley Tucci, Sophie Grabol and Christopher Eccleston in ‘Fortitude’
tvSo Sky Atlantic arrived in Iceland to film their new and supposedly snow-bound series 'Fortitude'...
Arts and Entertainment
Jenna Coleman as Clara Oswald in the Doctor Who Christmas special
tvForget the rumours that Clara Oswald would be quitting the Tardis
PROMOTED VIDEO
Arts and Entertainment
Sir Bruce Forsyth with Tess Daly in the BBC's Strictly Come Dancing Christmas Special
tvLouis Smith wins with 'Jingle Bells' quickstep on Strictly Come Dancing's Christmas Special
Arts and Entertainment
Japanese artist Megumi Igarashi showing a small mascot shaped like a vagina
art
News
The Queen delivers her Christmas message
newsTwitter reacts to Her Majesty's Christmas Message
Arts and Entertainment
tv
Life and Style
fashion
Sport
sport
ebooks
ebooksA year of political gossip, levity and intrigue from the sharpest pen in Westminster
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

Selby Jennings: Oil Operations

Highly Competitive: Selby Jennings: Our client, a leading European Oil trading...

The Jenrick Group: Night Shift Operations Manager

£43500 per annum + pension + holidays: The Jenrick Group: Night Shift Operatio...

SThree: Trainee Recruitment Consultant - LONDON

£20000 - £25000 per annum + OTE £40,000 + Car + Pension: SThree: SThree are a ...

SThree: Trainee Recruitment Consultant

£20000 - £25000 per annum + OTE £35K: SThree: We consistently strive to be the...

Day In a Page

Isis in Iraq: Yazidi girls killing themselves to escape rape and imprisonment by militants

'Jilan killed herself in the bathroom. She cut her wrists and hanged herself'

Yazidi girls killing themselves to escape rape and imprisonment
Ed Balls interview: 'If I think about the deficit when I'm playing the piano, it all goes wrong'

Ed Balls interview

'If I think about the deficit when I'm playing the piano, it all goes wrong'
He's behind you, dude!

US stars in UK panto

From David Hasselhoff to Jerry Hall
Grace Dent's Christmas Quiz: What are you – a festive curmudgeon or top of the tree?

Grace Dent's Christmas Quiz

What are you – a festive curmudgeon or top of the tree?
Nasa planning to build cloud cities in airships above Venus

Nasa planning to build cloud cities in airships above Venus

Planet’s surface is inhospitable to humans but 30 miles above it is almost perfect
Surrounded by high-rise flats is a little house filled with Lebanon’s history - clocks, rifles, frogmen’s uniforms and colonial helmets

Clocks, rifles, swords, frogmen’s uniforms

Surrounded by high-rise flats is a little house filled with Lebanon’s history
Return to Gaza: Four months on, the wounds left by Israel's bombardment have not yet healed

Four months after the bombardment, Gaza’s wounds are yet to heal

Kim Sengupta is reunited with a man whose plight mirrors the suffering of the Palestinian people
Gastric surgery: Is it really the answer to the UK's obesity epidemic?

Is gastric surgery really the answer to the UK's obesity epidemic?

Critics argue that it’s crazy to operate on healthy people just to stop them eating
Homeless Veterans appeal: Christmas charity auction Part 2 - now LIVE

Homeless Veterans appeal: Christmas charity auction

Bid on original art, or trips of a lifetime to Africa or the 'Corrie' set, and help Homeless Veterans
Pantomime rings the changes to welcome autistic theatre-goers

Autism-friendly theatre

Pantomime leads the pack in quest to welcome all
The week Hollywood got scared and had to grow up a bit

The week Hollywood got scared and had to grow up a bit

Sony suffered a chorus of disapproval after it withdrew 'The Interview', but it's not too late for it to take a stand, says Joan Smith
From Widow Twankey to Mother Goose, how do the men who play panto dames get themselves ready for the performance of a lifetime?

Panto dames: before and after

From Widow Twankey to Mother Goose, how do the men who play panto dames get themselves ready for the performance of a lifetime?
Thirties murder mystery novel is surprise runaway Christmas hit

Thirties murder mystery novel is surprise runaway Christmas hit

Booksellers say readers are turning away from dark modern thrillers and back to the golden age of crime writing
Anne-Marie Huby: 'Charities deserve the best,' says founder of JustGiving

Anne-Marie Huby: 'Charities deserve the best'

Ten million of us have used the JustGiving website to donate to good causes. Its co-founder says that being dynamic is as important as being kind
The botanist who hunts for giant trees at Kew Gardens

The man who hunts giants

A Kew Gardens botanist has found 25 new large tree species - and he's sure there are more out there