Shares rocket despite a risky trades crackdown
BRITISH trading companies are booming ahead of a crackdown on high-risk markets betting by the European financial watchdog.
CMC Markets posted a 24pc rise in profits in the year to March 31, a sign its new focus on targeting wealthier traders is paying off.
The shift of strategy is in part a response to a European curb on binary options and contracts for difference, which let punters to bet on markets going up or down.
The rules are set to be introduced later in the summer and are designed to stop novice traders losing big sums of money.
CMC, founded by former Conservative Party treasurer Peter Cruddas, says it is already meeting many of the requirements.
However, rival Plus500 said it was unsure what effect the rules will have as it reported a surge in new customers.
In a trading update, the Israeli business said a boom in the popularity of cryptocurrencies meant it had a record quarter of trading in the first three months of the year. CMC shares hopped 4.4pc, or 8.2p, to 195.2p while Plus500 shot up 6.8pc, or 110p, to 1722p.
The FTSE 100 failed to make up ground it lost when a glitch halted trading yesterday, closing 0.1pc, or 7.97, points lower at 7704.4. The
FTSE 250 edged 0.08pc, or 16.69 points, lower to 21,154.71.
Communications giant Vodafone and Sainsbury’s supermarket went ex-dividend, pushing shares near the bottom of the blue-chip index. Vodafone shares lost 4.6pc, or 9.1p, ending the day at 187.52p, while Sainsbury’s shares were off 3pc, or 9.5p, at 303.6p.
FTSE 250 gambling software maker Playtech sold its entire £198m stake in GVC, the owner of Ladbrokes and Coral bookmakers, to pay down its debt and pay for acquisitions.
Separately, a shareholder revolt at GVC’s annual meeting resulted in the forced resignation of nonexecutive director Peter Isola. Shares fell 0.9pc, or 7.2p, lower to 804.6p while GVC’s shares skipped 1.9pc, or 20p, higher to 1056p.
Auto Trader shares kicked up a gear after a solid set of full-years. The car marketplace increased revenue 7pc to £330.1m and pretax profit by 10pc to £210.8m.
The figures were boosted by rising second-hand car prices and its decision to allow customers to search for cars based on the monthly payment, rather than the sticker price. Shares revved 8.8pc, or 31p, higher to 385p.
Analysts at Citi backed Capita turnaround efforts, giving the outsourcer a ‘buy’ rating for the first time in more than five years. The broker also raised the firm’s target price from 104p to 160p.
Ed Steele, an analyst at Citi, said: ‘Capita should have reached its nadir.’ Shares were up 7.5pc, or 10.5p, to 150.05p.
Broker Peel Hunt raised the target price of Legoland owner Merlin Entertainments by 75p to 450p on the strength of its new attractions, such as Peppa Pig World of Play and the Bear Grylls Adventure, a theme park for adults.
But the backing did not do much for the shares, which eked out a tiny 0.1pc, or 0.4p, rise to 380.4p.
NewRiver Reit, the FTSE 250 property investment firm, snapped up Grays Shopping Centre, in Essex, for £20.2m. Wilko, Poundland, Iceland and Peacocks all have stores there. Shares reversed 0.7pc, or 2p, to 287.5p.
Shares in Veltyco, a marketing company to the gaming industry, jumped 6.7pc, or 5p, to 80p after a 165pc increase in revenue in 2017. Profit surged from £49,983 in 2016 to £6.7m last year.
Market research experts YouGov were downgraded from ‘buy’ to ‘ add’ by broker Peel Hunt, although it raised the firm’s target price by 80p to 495p. Shares sank 0.5pc, or 2.5p, to 465.5p.