Market report: Monday close
ITV shares plunged to a record low today after company broker UBS issued a sell note and trimmed its price target from 70p to 60p.
Latest share prices.
The stock sank as low as 61.9p before recovering slightly to stand down 4.6p at 63.3p - nearly 7% - after UBS warned that the UK advertising market is deteriorating sharply. The shares were worth more than 120p just 11 months ago, and word in the City today was that the weakness makes ITV vulnerable to a predator.
'This is getting dangerously low for ITV,' said Justin Urquhart Stewart of Seven Investment Management. 'They are a very realistic takeover target. Michael Grade should be looking over his shoulder.'
UBS analyst David Kerven warned that England's failure to qualify for the Euro 2008 football championships means there will be no summer boost to advertising revenues.
'Euro 2008 without England is unlikely to reignite the market and we would expect growth to slow in the second half,' he said.
It was a turbulent day in the City with the FTSE 100 index overcoming early losses of more than 100 points to stand up just 9.22 at 5702.1 tonight.
Banking stocks led by HBOS, 20p higher at 560p, were back in favour and a steady start on Wall Street offered support. The Dow Jones Industrial Average hovered around its opening mark, down just 4.5 at 12,211.90.
British Airways, off 5¾p to 234¼p, was given a hammering as passengers faced further chaos at Heathrow's Terminal-5. Goldman Sachs slashed its ratingon the stock from buy to sell and cut its price target from 330p to 200p. It is worried about a slowdown in business and consumer spending on both sides of Atlantic, increased competition from the Open Skies agreement, and the rising cost of oil.
The debacle at Terminal 5 has added to BA's woes. Far from solving all of the f lag- carrier's problems, the £4.3bn project has been nothing short of a disaster for both airline and airport.
Collins Stewart warned the disruption could cost BA as much as £50m as it faces a tidal wave of compensation claims and is forced to put up stranded passengers in hotels. It is also desperately trying to reunite passengers with luggage which has gone missing at the airport.
Analyst Andrew Fitchie said it was 'a disastrous start for T5' and warned BA's reputation has been severely damaged. EasyJet and Ryanair could benefit from any downturn in the airline industry, according to Credit Suisse. It expects easyJet, up 10p at 371¼p, to increase capacity by about 15% this year and said Ryanair, down 0.04 cents to €2.76, has the chance to add new routes to its network allowing it to grow faster than the rest of the market.
City coverage and share tips
This is Money carries breaking City news throughout the day. Bookmark Companies & Markets and try these markets links...
Morgan Stanley downgraded Vodafone, arguing that the telecoms giant was heavily exposed to a likely decision by the European Commission to bring forward proposals to cut the amount mobile operators charge customers for receiving calls for landlines. The broker said this will cut Vodafone's European earnings by 11% over the next three to four years. Vodafone fell 6.7p to 150.3p.
Tesco, down 11¼p to 379p, was under pressure after the supermarkets group put its Fresh & Easy store expansion on hold in the US, having opened 31 shops this year. Panmure Gordon said the decision to pause for breath 'will not help sentiment' towards the stock 'but looks sensible'.
Dairy Crest was down 9¾p at 469p after Dresdner Kleinwort lowered its rating from buy to add following Friday's trading update. Dresdner says Dairy Crest is suffering from the rising price of raw materials.
FTSE INFORMATION
Check out the latest data and updates from the stock market.
Tommorow's Agenda
• Harry Potter publisher Bloomsbury delivers annual results. Pre-tax profits are expected to climb to £17.5m from £5.2m in the previous 12 months on the back of better-than-expected sales. Although the final instalment in JK Rowling's series has been released, re-orders of the titles are proving lucrative.
• The start of the tax year for companies will see the rate of corporation tax rise for small and medium-sized businesses alongside a shake-up of capital allowances, which will, broadly speaking, decrease.
• How the manufacturing sector is faring will be revealed with the release of March's purchasing managers' index, which measures business activity. Growth picked up in February, according to the Chartered Institute of Purchasing & Supply's survey, rising to 51.3, with a reading above 50 indicating expansion.
Most watched Money videos
- 2025 Aston Martin DBX707: More luxury but comes with a higher price
- Blue Whale fund manager on the best of the Magnificent 7
- Land Rover unveil newest all-electric Range Rover SUV
- Tesla unveils new Model 3 Performance - it's the fastest ever!
- Mercedes has finally unveiled its new electric G-Class
- Mini celebrates the release of brand new all-electric car Mini Aceman
- Mail Online takes a tour of Gatwick's modern EV charging station
- BMW meets Swarovski and releases BMW i7 Crystal Headlights Iconic Glow
- Leapmotor T03 is set to become Britain's cheapest EV from 2025
- A look inside the new Ineos Quartermaster off-road pickup truck
- Introducing Britain's new sports car: The electric buggy Callum Skye
- Mini Cooper SE: The British icon gets an all-electric makeover
- MARKET REPORT: Fresnillo sparkles as gold hits a record high
- AstraZeneca targets $80bn in yearly revenues by 2030
- My insurer said driving from a station is commuting - and...
- Suits you sir! City slickers smarten up again: Briefcases...
- Bank sets the scene for summer rate cuts as deputy...
- No more delays on rate cuts: Bank Of England must stop...
- Sajid Javid eyes job at Shein as the Chinese fast fashion...
- Legal firm Knights Group predicts double-digit profit growth
- BUSINESS LIVE: AstraZeneca eyes $80bn in sales; Credit...
- Nationwide doubles its maximum personal loan to £50k -...
- CVS sells Dutch and Irish vet businesses for just €2
- The one thing you have to add to your shed to make sure...
- Stamp duty on shares must be axed, says London Stock...
- Now video game giant is buyout target: £2bn deal for...
- My ex-boyfriend plans to leave me his £2m estate and I'm...
- I need to remortgage and have inherited £100k - should I...
- Visa and Mastercard could face transparency crackdown as...
- Top investor throws weight behind Anglo American break-up...