AJ Bell bursts on to stock market as investors end week on a high
AJ BELL stormed on to the market yesterday with the stockbroker’s shares soaring by 35.8pc on its first day of trading. Despite fears that volatility and Brexit jitters would dampen demand for the float, the company was propelled by a wider rally that ended a rollercoaster trading week.
The “DIY” investment giant, which set its offer price at 160p, closed 60p higher at 220p as investors snapped up the shares and boosted the value of the firm to £40.6m.
The company had put 27pc of its stock up for sale after already giving its 197,000 customers exclusive access to its shares, and had the backing of City tycoon Michael Spencer. Chief executive Andy Bell, who set up the business with £10,000 of personal loans in 1995, has a 25pc stake worth around £175m following the float. Champagne will no doubt be popping in AJ Bell’s offices as 750 staff are also sharing a £2m windfall from the float.
AJ Bell was swept up in the wider market rebound in the wake of Thursday’s shock sell-off, as investors shrugged off escalating tensions between China and the US to end the week on a high. The FTSE 100 led the way among European indices, clawing back a 1.1pc gain to close at 6778.1 points after losing 3.15pc on Thursday, its worst day since the aftermath of the Brexit referendum in 2016.
However, despite a bright start, US markets quickly gave up early gains, with both the Dow Jones
Industrial Average and the S&P 500 slipping more than 2pc. Meanwhile, oil jumped in afternoon trade after major producing nations agreed to cut 1.2m barrels of oil from global supply in an attempt to rein in sliding prices. Brent crude climbed more than 5pc to just over $63 a barrel.
Shares in Associated
British Foods sank by 4.6pc to £22.42, making it the biggest blue-chip loser, after the Primark owner warned of “challenging” trading conditions on the high street. Finance boss John Bason blamed the warm weather for subduing demand for winter coats and clothes, that meant sales turning negative in November. Retail analyst Nick Bubb said the update would “strike fear” into rival retailer’s names because Primark regularly outperformed the market.
The bleak update from the UK’S third biggest clothing seller dragged shares in Debenhams 4.4pc lower to 5.7p and knocked
Marks & Spencer 0.3pc lower to 282p. Tesco shares jumped to the top of the FTSE leaderboard after analysts at UBS said there was a “decent possibility” of a share buy-back in the new year, despite the retailer’s debt pile still being three times its earnings.
Games Workshop, the niche retailer of figurine characters that has become a surprise stock market success, also jumped 4.3pc to £31.25 after an upbeat trading statement and a 30p dividend announcement.
Smith & Nephew shares soared to their highest level in 16 years, up 3.8pc to £14.75 after analysts at Deutsche Bank upgraded their recommendation from “Hold” to “Buy”.