EasyJet and Dixons set to fall out of the FTSE 100
Rentokil initial and packaging firm DS Smith look likely to emerge as the victors of the latest reshuffle of the FtSe – but easyJet and Dixons Carphone are among the losers.
every three months the market capitalisation of FtSe firms is reassessed, with companies booted out of the top flight if they are no longer making the grade.
A company’s market cap must fall to 111th as the market closes on reshuffle day for it to be relegated from the FtSe 100, and any firm hoping to climb into the top flight must be 90th-biggest by market cap, or above, to earn its promotion. Changes determined yesterday will take effect on March 20. Scottish Mortgage Investment
Trust looked likely to join the top 100. the trust, run by Baillie Gifford managers, invests in big businesses including Amazon, tesla, Ferrari and Alibaba. Shares edged up 0.1pc, or 0.4p, to 349.8p.
Plastic packaging firm DS Smith should climb too. it follows competitor Smurfit Kappa (up 0.3pc, or 7p, to 2146p) which moved up in the last reshuffle in December.
DS Smith shares were off 0.5pc, or 2.1p, to 445.7p.
Rentokil Initial has also earned its spurs. Yesterday the firm announced it had acquired a 57pc stake in a joint venture in india.
Shares climbed 1.7pc, or 4p, to 239.1p. But last time the firm reached the FtSe 100 in 2009 it stayed just three months. Demoted to the FtSe 250 is
Capita. Shares in the support services firm have bombed in recent months after profit warnings and contract impairments.
Shares advanced 2.7pc, or 15p, to 563.5p. EasyJet also crash- landed out of the FtSe 100. the airline faces sector-wide issues including terrorist attacks, rising oil prices, air-traffic control strikes and holidaymakers being put off going abroad by a weaker pound. But its shares gained 1.6pc, or 15p, to 951p.
Dixons Carphone is the final firm to face relegation. the retailer is facing a number of challenges including the effect of rising inflation on consumer confidence and the ongoing battle between online and bricks and mortar stores. the firm has been in the top flight for 19 years. Shares leapt 1.9pc, or 5.6p, to 303p.
the FTSE 100 itself finished up 0.14pc, or 10.44 points, at 7263.44. Margin worries dragged Money
supermarket shares lower, despite a confident update. liberum said it was concerned that revenue growth at the price comparison site was too linked to its marketing spend. the firm’s margin has slipped from 80pc to 75pc. in an update, the group said revenue climbed 12pc to £316.4m and oper- ating profit was up 13pc to £91.1m. the company also announced a £40m share buy-back programme. it has hiked its dividend by 8pc to 9.85p. Shares slumped 6.1pc, or 21.3p, to 329.7p.
Interserve has suspended its dividend after falling into the red. the support services firm made a loss before tax of £94.1m in 2016, down from a £79.5m profit the year before. that’s despite revenues climbing slightly to £3.2bn.
interserve blamed delays around the 2015 General election and Brexit uncertainties for a decline in Uk business, as well as an exceptional £160m charge for its failed incinerator business. Shares gained 1.1pc, or 2.75p, to 239.5p.
Laird shares flopped after the firm announced underlying pretax profit had plunged 30pc to £51.1m in 2016. the electronics firm blamed weaker sales in its precision metals business. laird announced a rights issue to raise £185m which it will use to reduce its borrowings. Shares tumbled 4.1pc, or 7.25p, to 167.5p.