Rus­sia and WPP weigh on FTSE 100

The Daily Telegraph - Business - - Business - TOM REES

RUS­SIAN-LINKED min­ers Poly­metal and Evraz were hit by a fresh wave of sell­ing yes­ter­day as the Trump ad­min­is­tra­tion lined up new sanc­tions tar­get­ing Vladimir Putin’s in­ner cir­cle of ty­coons.

Lon­don-listed stocks con­trolled by Rus­sian oli­garchs with close ties to Putin tum­bled af­ter US am­bas­sador to the United Na­tions Nikki Ha­ley warned that it would pun­ish Moscow’s sup­port for the As­sad regime.

City an­a­lysts at RBC Cap­i­tal Mar­kets warned in­vestors that the de­te­ri­o­ra­tion in re­la­tions be­tween the West and Rus­sia had been “a rapid es­ca­la­tion in risk for com­pa­nies with Rus­sian-based as­sets”.

Com­pa­nies con­trolled by Putin al­lies suf­fered sharp share price falls last week af­ter the White House’s first round of sanc­tions.

As in­vestors braced for more mea­sures, Ro­man Abramovich-owned miner Evraz nose­dived 27.4p to 365.2p, a 7pc tum­ble, while Rus­sia-fo­cused Poly­metal slipped 64.4p, or 9.6pc, to 611.2p.

Evraz’s fall along with ad giant WPP’s 6.5pc plunge fol­low­ing the exit of boss Sir Mar­tin Sor­rell weighed heav­ily on the FTSE 100. The pound hit­ting a post-Brexit vote high against the dol­lar at the end of play ramped up the pres­sure on the in­dex’s ex­porters, drag­ging it to a 66.36-point loss at 7,198.20.

Amid the re­cent flurry of deals in the health­care sec­tor, a surge in em­bat­tled pharma firm Vec­tura’s trad­ing vol­ume reignited long­stand­ing bid ru­mours in the City as it soared 10.6p, or 11pc, to 104.5p.

As Vec­tura’s trad­ing vol­ume hit eight times its av­er­age, City an­a­lysts spec­u­lated that Vec­tura los­ing some of its dis­grun­tled share­hold­ers since its strat­egy shift may have also re­lieved some of the sell­ing pres­sure on the strug­gler. Pharma gi­ants No­var­tis and Glax­oSmithK­line have been among the names linked with Vec­tura, which slumped to its low­est level since 2012 in March.

Feared ac­tivist in­vestor El­liott Ad­vi­sors re­veal­ing a stake of over 6pc in Costa Cof­fee owner Whit­bread over the week­end boosted its shares 283p to £42.18. The Paul Singer-led hedge fund snap­ping up a stake stirred spec­u­la­tion that it could push for a break-up of the FTSE 100 com­pany.

Smur­fit Kappa ad­vanced 90p to £30.72 af­ter re­ports sur­faced claim­ing that in­vestors are putting pres­sure on the pa­per and pack­ag­ing giant to hold talks with takeover suitor In­ter­na­tional Pa­per.

Bar­clays nudged up 0.5p to 213.8p as Jef­feries an­a­lysts ar­gued that ac­tivist in­vestor Sher­borne tak­ing a large stake in the bank­ing giant could pro­pel its shares higher.

Fi­nally, tech giant Sage’s share price plunge ex­tended into a sec­ond ses­sion af­ter JP Mor­gan an­a­lysts piled on the pain, down­grad­ing it to “neu­tral” to knock it 18.6p lower at 598.4p.

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