Market Report: Pearson's falls short of expectations

Pearson’s “next big thing” is already falling short of expectations.

The Financial Times owner and education group tumbled following reports in the US that Los Angeles’ second biggest school district is cancelling a $1.3bn (£870m) education project. Apple has been providing iPads to schools preloaded with education content created by Pearson, but the district claims the content isn’t good enough.

It’s not a good sign for Pearson, which has been trumpeting the potential of education technology to boost its growth. It shares plunged 57p to 1,370p – the Footsie’s biggest faller.

BAE Systems dipped 16.5p to 516p as the shares traded ex-dividend and UBS downgraded the defence giant, arguing that its price is unlikely to rise much higher given a recent strong run.

Nomura trimmed its price target for Tesco ahead of next week’s annual results, leaving the supermarket 5.85p lower at 241.05p. The investment bank thinks we have not seen the end of aggressive price wars in the sector.

The FTSE 100 fell back from record highs, dipping 36.33 points to 7,060.45.

Profit warnings on the mid-cap index left investors in a sour mood. Telecom Plus, the bill-bundling service that operates under the Utility Warehouse brand, collapsed 193p to 785p after admitting that profits are set to be £10m lighter than previously advertised, due to bad debt, falling energy prices and a warm winter. Management did their best to support the price, with five executives buying a collective £1.1m worth of shares.

Petra Diamonds tumbled 19.3p to 165p after admitting it is struggling to find as many top-quality stones at its pits, which have been heavily mined.

The satellite specialist e2V rocketed 15p to 215p after announcing that a good end to 2014 means full-year figures are set to be ahead of expectations.

The online video advertising business Blinkx climbed 1.5p to 28.5p after it snapped up the movie and music website operator All Media Network for an undisclosed sum.

The Australian oil and gas explorer Oilex rose 0.5p to 4p on the back of reassuring oil-reserve test results at one of its fields in India.