FTSE 100 movers: Retailers rally; Fresnillo loses its shine
By Michele Maatouk
Date: Monday 22 Apr 2024
(Sharecast News) - London's FTSE 100 was up 1.7% at 8,026.12 in afternoon trade on Monday.
Ocado was the standout gainer following a report over the weekend the company is under pressure from shareholders to consider abandoning London for New York.
According to The Telegraph, face-to-face conversations have been held with investors in recent weeks in which the idea of shifting its listing to America was discussed in detail.
It was understood that at a private dinner around the time that its annual results were published last month, at least one leading fund manager told management that it would like to see the prospect of a trans-Atlantic shift explored properly.
The Telegraph said City sources believe Ocado founder and chief executive Tim Steiner could be persuaded to consider a move to the US amid longstanding frustrations over the reluctance of some investors to recognise it as a bona fide technology company rather than a struggling, perennially loss-making online grocer.
Marks & Spencer and Sainsbury's were also in the black after Jefferies upgraded its stance on the shares to 'buy' from 'hold'.
On M&S, for which it has a 310p price target, Jefferies said it thinks the company is now a far stronger business than was historically the case.
"This newfound strength is built on an expansion of the food offer which is clearly resonating strongly," it said.
It said growing market share and margins in both core businesses should help underpin both earnings expansion and, more critically, multiple expansion, as the market recognises the less volatile path of earnings and free cash flow delivery the stock now offers.
On Sainsbury's, the bank said fears around an excess capex burden limiting free cash flow upside have provoked intense investor concern since the capital markets day in February.
"We believe this overstates the risks and overlooks the positives emerging from the most supportive competitive backdrop in UK grocery in decades," it said.
"SBRY in particular have outlined a multi-pronged approach to capitalising on this situation. As we noted after the CMD, the plan is to enable margin expansion through volume growth and opex control.
"All of which offer substantial upside to FCF, which we see at a cumulative £1.8bn over the next three years versus guidance for 'at least £1.6bn'."
Precious metals miner Fresnillo lost its shine as gold and silver prices fell as demand for safe havens eased.
FTSE 100 - Risers
Ocado Group (OCDO) 361.80p 4.21%
Marks & Spencer Group (MKS) 255.90p 4.11%
Pershing Square Holdings Ltd NPV (PSH) 3,964.00p 3.99%
Sainsbury (J) (SBRY) 269.00p 3.94%
Persimmon (PSN) 1,335.50p 3.85%
Tesco (TSCO) 291.70p 3.66%
Vodafone Group (VOD) 69.40p 3.58%
International Consolidated Airlines Group SA (CDI) (IAG) 175.50p 3.54%
WPP (WPP) 800.80p 3.44%
Next (NXT) 9,062.00p 3.28%
FTSE 100 - Fallers
Fresnillo (FRES) 579.50p -3.74%
Anglo American (AAL) 2,133.50p -2.09%
Intermediate Capital Group (ICG) 1,981.00p -0.95%
SSE (SSE) 1,658.00p -0.15%
Flutter Entertainment (DI) (FLTR) 14,830.00p -0.07%
CRH (CDI) (CRH) 6,248.00p -0.06%
RELX FINANCE BV 3.375% GTD NTS 20/03/33 (BW73) 99.72p 0.00%
Centrica (CNA) 131.95p 0.19%
Convatec Group (CTEC) 283.20p 0.21%
Antofagasta (ANTO) 2,256.00p 0.27%
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