The FTSE 250 index was in the red on Monday, in sync with wider global stock markets as trade worries weighed.
Bottom of the mid-cap index was TI Fluid Systems, down 5% to erase most of the 10%-plus gains since the start of the month as the shares
last week hit their highest level since listing last autumn. Moreover, the maker of such auto components as fuel and brake fluid lines could be hit by the crossfire of the US-China trade tariff tit-for-tat, with automotive one of the sectors lined up for inclusion.
TalkTalk was down as broker Numis put out a 'sell' note on the telecoms company saying risks were rising, even though the business is less complex, the balance sheet is no longer stretched and the outlook for exceptional costs is less vague. "But the company still competes mainly on price against numerous, much better resourced rivals," analysts said, hearing rumours that in the business market, BT Wholesale now competes more on price as it prefers to earn less ARPU than to keep losing share to its smaller rival.
Numis also downgraded flexible office group Workspace to 'hold' with a target price of 1,096p driven by a combination of factors: a "less compelling" valuation following recent share price strength and after the recent equity raise diluted the forward return profile. Analysts added that they were "unconvinced that acquisitions, which look to be the most likely use of equity proceeds, are WKP's most value-additive strategy".
ContourGlobal, the power-generation specialist, was elevated after it revealed late on Friday that it was still in talks with Alpek about potential buying the Mexican company's cogeneration power plants in Cosoleacaque and Altamira. "While discussions are continuing, there can be no assurance that a commercial agreement will be reached and that a transaction will be completed."
Virgin Money was also lower after its takeover by CYBG was approved by the board, with the backing of major shareholder Virgin Group. Some investors were disappointed there was no cash element to the deal.
Following a challenging period for technology and services firm Cobham, analysts at Morgan Stanley gave the defence contractor a boost on Monday as it highlighted an improved risk-reward case on the horizon. Analysts at the investment bank think Cobham's current management team have successfully "stabilised" the group's performance, upgrading the rating on the shares from 'equal-weight' to 'overweight' and its target price on the "currently under-earning" firm to 150p from its previous 115p figure.
Wetherspoon was one of several pub companies boosted by positive industry data released on the day, with Greene King also in the green, Mitchells & Butlers moderately higher, but Marston's and City Pub lower. Like for like sales across managed pubs fizzed up 3.5% in May, the Peach Coffer tracker survey revealed, with drink-led outlets doing best. Analysts at Liberum said they expect the drink-led pubs to continue to outperform in the months ahead, helped by better weather and the World Cup. "Conversely, restaurant and food-led pubs are likely to have a tougher summer."
FTSE 100 (UKX) 7,620.81 -0.17%
FTSE 250 (MCX) 20,943.32 -0.30%
FTSE 250 - Risers
Contour Global (GLO) 216.00p 4.85%
Cobham (COB) 129.35p 4.02%
888 Holdings (888) 285.40p 2.96%
Softcat (SCT) 765.00p 2.82%
Alfa Financial Software Holdings (ALFA) 190.80p 2.69%
Saga (SAGA) 126.90p 2.42%
On The Beach Group (OTB) 512.00p 2.20%
Aveva Group (AVV) 2,750.00p 2.15%
Wetherspoon (J.D.) (JDW) 1,249.00p 2.04%
Domino's Pizza Group (DOM) 349.30p 1.72%
FTSE 250 - Fallers
TI Fluid Systems (TIFS) 272.00p -5.56%
TalkTalk Telecom Group (TALK) 112.40p -4.99%
Workspace Group (WKP) 1,101.00p -4.34%
Elementis (ELM) 284.87p -3.76%
IntegraFin Holding (IHP) 363.00p -3.20%
Virgin Money Holdings (UK) (VM.) 344.40p -2.99%
Travis Perkins (TPK) 1,409.50p -2.83%
Big Yellow Group (BYG) 958.50p -2.44%
G4S (GFS) 269.10p -2.43%
Ferrexpo (FXPO) 200.90p -2.24%