Market report: Friday close

By Mickey Clark for MailOnline
Updated: 13:34 EDT, 28 March 2008

If you thought sentiment could hardly be any worse for troubled retailers DSG International and Kingfisher, think again.

Hugo Duncan, Evening Standard City Desk

One of DSG's fiercest critics, Nick Bubb of Pali International, got even more negative today, downgrading the stock in a scathing analysis that described the shares as merely a 'selling opportunity'.

Meanwhile, Moody's cut its rating on Kingfisher as the B&Q owner's miserable year continued.

DSG has plummeted since the Currys and PC World company fell out of the FTSE 100 index in November but has further to go, according to Bubb. He reduced his price target from an already lowly 60p to 53p, warning the dividend is certain to be cut due to lack of cash.

'The efforts of a new chief executive to turn things around are likely to be swamped by the cyclical downturn and the impact of the credit crunch on household spending,' he said.

DSG fell another 3¾p to 64½p today, a slide of more than 6%.

Kingfisher was given a kicking just 24 hours after new chief executive Ian Cheshire reported falling profits and slashed the dividend by a third. The shares fell 4.7p to 130.4p yesterday and another 0.6p to 131p today after Moody's cut its rating outlook to negative from stable. 'Moody's believes that the expected decline in UK consumer spending will weigh on Kingfisher's performance over the next 12 months,' said Moody's analyst Yasmina Serghini.

Shares in property firm Mapeley, landlord to HM Revenue & Customs, tumbled more than 15% after talks about a takeover by US hedge fund Fortress collapsed.

Fortress already owns just over half of the company, and the word was that it has been lining up a bid to buy out the remaining shareholders for more than £19 a share, valuing Mapeley at about £560m. The shares closed at 1557p last night but news that the talks were over sent Mapeley down 236p to 1321p.

Carnaby Street landlord Shaftesbury, off 5p to 580p, was generating interest again after activist investor Laxey Partners upped its stake from 11.8% to 14.49%. Laxey, which unsuccessfully tried to break up British Land, bought its initial stake via derivatives from Newcastle United owner Mike Ashley and property entrepreneur Paul Kemsley.

The FTSE 100 fell 24.57 points to 5692.9 as dismal figures from mortgage lender Nationwide showed the housing market in its worst state for 12 years. The Dow Jones Industrial Average rebounded from last night's 120-point loss to stand 28 higher at 12,330.5.

Housebuilders in London felt the pain on the back of the Nationwide figures and the decision to increase the cost of taking out a mortgage. Persimmon led the blue-chip fallers with losses of 40p to 749½p while second-tier rival Barratt Developments sank 27¼p to 410¾p. It was followed by Bellway, down 11p to 874p, Redrow, off 1¾p to 312¾p and Taylor Wimpey, down 1¼p to 185¾p. Bovis Homes rose by ½p to 599p

Credit Suisse reckons plumbing and building materials supplier Wolseley is a high-risk investment because of its big debt levels and the outlook for its markets on both sides of the Atlantic. The shares fell 15p to 537p.

The management vacuum at Southampton Leisure, down ½p at 38p, continues as the owner of the struggling Championship football club lurches into its latest bout of internecine fighting. Former chairman Rupert Lowe and director Michael Wilde are understood to be plotting a renewed takeover attempt and could force an emergency general meeting. It has emerged that a potential rival consortium could include John Cresswell, the chief operating officer of ITV.

MONDAY'S AGENDA

• Hometrack's house price survey and a separate update on Britain's productivity are likely to fuel the gloom surrounding the economy. The property website is forecast to report the sixth consecutive month of falling prices. Today's dismal Nationwide numbers highlight the extent of Britain's looming property slump.

• Cairn Energy, the oil and gas explorer, unveils full-year results. Cairn's shares have climbed in anticipation of strong numbers on the back of soaring oil prices.

• Aim-listed pollster and research group YouGov is expected to report a near doubling in profits to £10.7m when it delivers first half figures. It is believed to be benefiting from a shift towards greater use of the internet in market research, while its reputation for accuracy in polling is said to dissuade potential rivals from entering the sector.