Wall Street tech rout puts Aveva into steep reverse
THE aftermath of a Wall Street tech rout ensured no hiding place for London-listed Aveva today as the industrial software group warned over rising cost pressures.
Shares in the FTSE 100-listed company skidded 12% as it revealed 2023 earnings will be hit by factors including a wage bill driven higher by the “very competitive” software labour market.
The group, whose technology improves operations for companies including EDF Energy and BP, is one of a small number of top flight stocks directly exposed to weaker sentiment caused by the recent dumping of US growth stocks.
The Nasdaq fell 4% last night to its lowest level since December 2020 as investors reacted to an outlook clouded by rising interest rates, higher prices and component shortages.
While Aveva tumbled 281p to its lowest level since 2019 at 2007p, grocery warehouse robotics business Ocado dropped another 14.6p to a fresh threeyear low of 935.4p.
The wider FTSE 100 index weathered the storm as a rebound for commodity stocks helped the top flight to lift 13.92 points to 7400.11.
A largely encouraging batch of firstquarter updates also helped the mood after Lloyds beat expectations to send shares 2% higher and boost rivals HSBC and NatWest.
Glaxo Smith Kline improved 11.3p to 1765.9p after chief executive Emma Walmsley reported better-than-expected first quarter earnings and confirmed that July’s demerger of consumer health division Haleon remains on track.
The FTSE 250 index fell 26.60 points to 20,465.52 as selling pressure in the retail sector continued through further losses for Trustpilot and Marks & Spencer. WH Smith fell 5% after its interim results but biomass power station business Drax rose 3% after a trading update.
Ted Baker shares, meanwhile, lifted 3p to 150p as the fashion retailer said it has entered into due diligence on a potential sale of the business having received “a number of non-binding proposals”.