WPP’S woes fuels fall on stock market

Market report Perry Gourley

Shares in advertising giant WPP were one of the biggest fallers on the stock market in the wake of the resignation of long-standing chief executive Sir Martin Sorrell.

Sorrell, who was the boss of the advertising giant for more than 30 years, stepped down over the weekend following allegations of misconduct. WPP’S shares closed the day down 6.48 per cent or 77p at 1,111p.

London’s blue chip index was under pressure as sterling climbed on hopes of positive data on UK employment. The FTSE 100 ended the day 66.36 points lower at 7,198.2.

UK unemployment is expected to remain constant at 4.3 per cent in data published today, but average earnings are forecast to rise to 3 per cent in the three months to February, meaning wage growth could overtake inflation for the first time in over a year. This could also encourage a “more hawkish” tone at the Bank of England’s next meeting in May, according to Fiona Cincotta, senior market analyst at City Index.

She added: “The index was weighed down by a combination of a weaker oil price, a stronger pound and a large sell-off in WPP and Evraz, although a rally in the US helped lift the FTSE into the close.

Shares in Costa owner Whitbread rocketed after activist investor Elliott said it had become the business’s largest shareholder.

Elliott now owns over 6 per cent of Whitbread and it is understood that it will now push for Costa and Premier Inn to become two separate listed entities.

Whitbread’s shares closed up 283p at 4,218p. The leisure group behind Costa Coffee and Premier Inn rose amid speculation of calls for a break-up by a Us-based activist investment group. The resources firm saw its shares fall after confirming it had received a request for arbitration from an oil and gas group in Georgia.