Royal Mail rally is a rare delight for shareholders

It has been a torrid time for Royal Mail shareholders since the stock peaked at over 630p a little over two years ago.

By early April, following weeks of panic selling all over the world as the Covid-19 pandemic spread, the shares were changing hands for close to 120p.

But, despite a string of problems facing the 500-year-old postal service, from a slump in letter deliveries to a battle with unions over modernisation, the stock now has something of a spring in its step. Shares rose as high as 237p in early trading yesterday – a level not seen since late last year. It later closed up 6pc, or 13.2p, at 233.7p – taking gains this week alone to 35pc.

the latest rise came as analysts at JPMorgan raised its price target for Royal Mail shares to 253p from 145p.

the rally will be welcomed by Royal Mail’s army of small shareholders as well as boss Keith Williams and a billionaire investor dubbed the ‘Czech sphinx’. that is Daniel Kretinsky, who owns Sparta Prague football club and is Royal Mail’s biggest shareholder with a 13pc stake through his firm Vesa Equity Investment.

the continued recovery in Royal Mail shares came as the FTSE 100 edged up 0.5pc, or 28.7 points, to 6032.09, while the mid-cap

FTSE 250 fell 0.1pc, or 18.08 points, to 17555.87.

traders were digesting official figures showing the UK economy continued its recovery in July – with GDP up 6.6pc – although output is still 11.7pc down since the Covid-19 pandemic struck.

Gyrations in US tech stocks and mounting tensions over Brexit between Britain and the EU have weighed on the minds of investors this week – with the pound drifting below $1.28 having been close to $1.35 at the start of the month.

‘Markets are a bit tired with traders taking a breather following the up and down movement in the US-based tech rout,’ said Connor Campbell, financial analyst at Spreadex.

Following largely positive results a day earlier, Dunelm was given a helping hand by JP Morgan where analysts increased the price target to 970p from 875p. Shares went up 4.8pc, or 64p, to 1405p.

Morgan Stanley cut its price target for Cineworld from 60p to 45p – but that did not deter traders who sent the stock up 4.9pc, or 2.45p, to 52p.

Back in the top flight, Morrisons drifted lower by 3.1pc, or 5.7p, to 180.3p after Berenberg trimmed its targets for the supermarket.

Ferrexpo shares rose 7pc, or 12.3p, to 188.2p after it declared a special interim dividend of 6.6 US cents per share. the move took the Swiss-headquartered iron ore company’s total handouts for 2020 to 19.8 cents per share. the special interim dividend will be paid on October 8 to shareholders on the register at close of business on September 25. But the company also faced an investor rebellion, with nearly a third of votes at its general meeting rejecting its bid to re-elect Vitalii Lisovenko as a non-executive director. Shareholders in troubled lender

Amigo will hold a vote on whether to reinstate founder James Benamor as chief executive at the end of the month.

the board, which is locked in a battle with Benamor over the company’s future, recommended that shareholders vote against the proposal, and others that would restructure Amigo’s top team.

Benamor, formerly Amigo Holdings’ biggest shareholder, called the vote – to be held on September 29 – after claiming the firm needed a shake-up at the top. the board warned shareholders that, if Benamor wins, it could leave key positions, including those of chair, chief executive and finance chief, vacant for some time. Shares fell 12.2pc, or 1.66p, to 12p.