Market Report: Resolution's payout freeze chills shares

There is not much worse than being promised something before it is cruelly snatched away. That's the situation in which unimpressed investors in Resolution found themselves yesterday after the insurance conglomerate cancelled a £250m handout.

The buyout specialist – set up in 2008 by entrepreneur Clive Cowdery – blamed the economic climate and uncertainty around the sector for the decision, although this didn't placate the City. Instead, Resolution dropped as much as 10 per cent during trading, and while the stock managed to recover some of these losses, by the end of the day it was still one of the worst blue-chip fallers, having dived 12.4p to 215.5p.

With bosses at the company having put the payout on hold in March, Deutsche Bank's Oliver Steel said the decision to cancel it should not be a surprise. However, the analyst also pointed out Resolution's statement "suggests that there is no prospect of [a] cash return ever" while he added that "confidence in the company's strategic direction has probably ... taken another knock, coming on top of the group's apparently shifting view on M&A". Traders agreed – "I just think that people are getting very disillusioned with it," was the view of one.

The stock was not the only one being knocked by the news, however. Speculation has recently made a return suggesting Resolution could make another attempt to snap up Phoenix Group, but last night the mid-tier insurer finished 15p weaker at 490.5p amid concerns the likelihood of such a move was now even lower.

A rapid jump in Spanish bond yields put the Eurozone crisis back on the radar, with the FTSE 100 moving back from a two-and-a-half-month high by sinking 62.42 points to 5,651.77.

Barclays – which has dropped nearly 19 per cent since the Libor scandal hit its share price – was doing its best to bring Lloyds down as well. Analysts from the group's investment bank told investors to sell their shares in its rival, saying it had "the greatest amount of restructuring still to do, its capital position looks weak and its most profitable business [retail] is shrinking". However, although Lloyds did drop 0.3p to 29.94p, Barclays was worse off after falling 5p to 159.25p – elsewhere in the sector, Royal Bank of Scotland was driven back 7.6p to 204.7p.

Risers were rather hard to find, although Arm Holdings was one. The chip designer was helped by Apple's iPad 3 – which contains its technology – going on sale in China for the first time. There was also confidence over the forthcoming launch of Microsoft's Windows 8 in the wake of the computing giant's fourth-quarter results late on Thursday.

Weir Group was another moving higher. The pump maker ticked up 6p to 1,531p in the wake of results from fellow oil services companies Baker Hughes, Schlumberger and Gardner Denver across the Atlantic all beating Wall Street's forecasts.

With Dutch giant Heineken announcing a $4.1bn (£2.6bn) bid to take full control of Tiger beer maker Pacific Breweries, Liberum Capital's Pablo Zuanic suggested SABMiller "could also get involved" as the owner of Grolsch dipped 21p to 2,700p.

After speculation emerged late on Thursday claiming rumour mill favourite the London Stock Exchange could be a possible target for the Singapore Stock Exchange, the latter yesterday denied there had been talks between the two over a possible merger. Instead, the bourse said it was "open to collaborations and partnerships", as the LSE was knocked back 16p to 1,007p.

Undertaker Dignity rose 23.5p to 837p on optimism ahead of its update later in the month. While Investec's analysts admitted the period "is seasonally weaker", they added that "preliminary death rate data... suggests [the second-quarter] won't disappoint" and told investors to buy the stock as a result.

On AIM, Dawson International slumped by 0.52p to 0.62p after the cashmere maker – and former owner of the Pringle brand –admitted that its failure to strike a new pensions deal meant administration was now a possibility.

Start your day with The Independent, sign up for daily news emails
News
newsAnother week, another dress controversy on the internet
Life and Style
Scientist have developed a test which predicts whether you'll live for another ten years
health
Life and Style
Marie had fake ID, in the name of Johanna Koch, after she evaded capture by the Nazis in wartime Berlin
historyOne woman's secret life as a Jew in wartime Berlin
News
news... and what your reaction to the creatures above says about you
ebooks
ebooksA special investigation by Andy McSmith
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

Ashdown Group: Junior Application Support Analyst - Fluent German Speaker

£25000 - £30000 per annum + benefits: Ashdown Group: A global leader operating...

Recruitment Genius: Customer Service Advisor

£15000 - £16000 per annum: Recruitment Genius: A Customer Service Advisor is r...

Ashdown Group: Trainee Consultant - Surrey / South West London

£22000 per annum + pension,bonus,career progression: Ashdown Group: An establi...

SThree: HR Benefits Manager

£40000 - £50000 per annum + pro rata: SThree: SThree Group have been well esta...

Day In a Page

Syrian conflict is the world's first 'climate change war', say scientists, but it won't be the last one

Climate change key in Syrian conflict

And it will trigger more war in future
How I outwitted the Gestapo

How I outwitted the Gestapo

My life as a Jew in wartime Berlin
The nation's favourite animal revealed

The nation's favourite animal revealed

Women like cuddly creatures whilst men like creepy-crawlies
Is this the way to get young people to vote?

Getting young people to vote

From #VOTESELFISH to Bite the Ballot
Poldark star Heida Reed: 'I don't think a single bodice gets ripped'

Poldark star Heida Reed

'I don't think a single bodice gets ripped'
The difference between America and Israel? There isn’t one

The difference between America and Israel? There isn’t one

Netanyahu knows he can get away with anything in America, says Robert Fisk
Families clubbing together to build their own affordable accommodation

Do It Yourself approach to securing a new house

Community land trusts marking a new trend for taking the initiative away from developers
Head of WWF UK: We didn’t send Cameron to the Arctic to see green ideas freeze

David Nussbaum: We didn’t send Cameron to the Arctic to see green ideas freeze

The head of WWF UK remains sanguine despite the Government’s failure to live up to its pledges on the environment
Author Kazuo Ishiguro on being inspired by shoot-outs and samurai

Author Kazuo Ishiguro on being inspired by shoot-outs and samurai

Set in a mythologised 5th-century Britain, ‘The Buried Giant’ is a strange beast
With money, corruption and drugs, this monk fears Buddhism in Thailand is a ‘poisoned fruit’

Money, corruption and drugs

The monk who fears Buddhism in Thailand is a ‘poisoned fruit’
America's first slavery museum established at Django Unchained plantation - 150 years after slavery outlawed

150 years after it was outlawed...

... America's first slavery museum is established in Louisiana
Kelly Clarkson: How I snubbed Simon Cowell and become a Grammy-winning superstar

Kelly Clarkson: How I snubbed Simon Cowell and become a Grammy-winning superstar

The first 'American Idol' winner on how she manages to remain her own woman – Jane Austen fascination and all
Tony Oursler on exploring our uneasy relationship with technology with his new show

You won't believe your eyes

Tony Oursler's new show explores our uneasy relationship with technology. He's one of a growing number of artists with that preoccupation
Ian Herbert: Peter Moores must go. He should never have been brought back to fail again

Moores must go. He should never have been brought back to fail again

The England coach leaves players to find solutions - which makes you wonder where he adds value, says Ian Herbert
War with Isis: Fears that the looming battle for Mosul will unleash 'a million refugees'

The battle for Mosul will unleash 'a million refugees'

Aid agencies prepare for vast exodus following planned Iraqi offensive against the Isis-held city, reports Patrick Cockburn