Provident Financial to crash out of FTSE 100

Troubled sub-prime lender Provident Financial looks set to be ejected from the FTSe 100 at the close of play today.

The business faces demotion in the latest quarterly market reshuffle after a turbulent two weeks.

last week Provident shares collapsed 66pc in a day after it warned of heavy losses.

As the firm revealed regulators were investigating products sold by its Vanquis banking arm, chief executive Peter Crook resigned and a new boss was brought in.

It was an unwelcome turn of events for star fund manager Neil Woodford who is the second largest shareholder in the business with a 19pc stake.

The veteran investor has seen several of the firms he backs rocked in recent weeks.

Companies in the FTSe 100 are relegated in the reshuffle when their market capitalisation falls to 110th largest of all uK listed firms. The final decision will be made when the market closes today, but Provident looked a likely candidate yesterday even after a pullback in its share price. The firm was down 1pc, or 9.5p, to 906.5p.

Royal Mail is also under threat from relegation, with its shares down another 1.5pc, or 5.7p, to 387.5p. Construction company

Carillion could drop out of the FTSe 250 after a profit warning last month wiped £600m off its value. Chief executive richard Howson stepped down as it revealed it was struggling to stay within its borrowing limits.

Yesterday, its shares slumped 5.1pc, or 2.5p, to 47.2p. Changes made by the reshuffle will come into effect on September 18. Sentiment towards supermarkets slipped as Amazon revealed it would slash prices at its newly acquired Whole Foods grocery store group.

The internet giant yesterday cut prices on products by as much as 43pc and experts say that while the cuts are largely symbolic in the uK, where there are only a handful of Whole Foods stores, it is a significant move.

laith Khalaf, senior investment analyst at Hargreaves lansdown, commented: ‘The last thing [the big four supermarkets] need is a large, price-insensitive competitor like Amazon coming to play in their sandpit.’

Tesco fell 1.8pc, or 3.35p, to 180.9p, Sainsbury slipped 2.3pc, or 5.4p, to 230.7p, while Morrisons plunged 3.7pc, or 9.3p, to 242.1p.

lloyd’s of london insurers took a tumble as one analyst estimated that the bill for Hurricane Harvey in Texas could reach £77bn.

The uS state has been battered by the tropical storm since the weekend with another 50 inches of rain forecast to fall. Hurricane Katrina, which hit New orleans in 2005, caused £ 92bn damage. experts estimate less than a third of the damage caused by this latest catastrophe will be insured.

Hiscox dipped 2.3pc, or 30p, to 1256p, Beazley fell 2.8pc, or 15.5p, to 506p and Lancashire, which owns lloyd’s insurer Cathedral, dived 3.5pc, or 24.5p, to 670p. on a day of uncertainties the

FTSE 100 closed down 0.9pc, or 64.03 points, to 7337.43. recruitment firm InterQuest

Group blamed brexit woes for a 14pc fall in net fee revenue to £9.5m in the six months to June 30. earnings were down 19pc to £1.3m and its shares plummeted 11.7pc, or 5.5p, to 41.5p.

berenberg upped its rating on hotel-booking website Hostelworld to a ‘buy’. It increased its target price for the stock by 37pc, to 370p. Analysts said Hostelworld had made a strong recovery since a profit warning in May last year. Shares leapt 4.7pc, or 14.75p, to 330.75p.