Market Report: Mike Ashley's Sports Direct runs out of puff in investor mutiny

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Billionaire Sports Direct founder Mike Ashley was dealt another blow today, as the retailer’s shares bucked the upward trend across the FTSE 100 and languished in negative territory.

Sports Direct was one of only two stocks in the red having retreated 4p to 776.36p.

The decline comes after backer Royal London Asset Management said it wanted Ashley, the executive deputy chairman, out of the role, criticising him for failing to attend board meetings.

Royal London also said it would vote against the re-election of Sport Direct’s non-executive directors, whom it accused of poor governance.

The intervention follows the lead of Pirc, which last week advised investors to oppose chairman Keith Hellawell’s re-election at tomorrow’s AGM and questioned the competency of the board as a whole.

The rest of the FTSE 100 brushed off yet more gloomy data from China, pushing the blue-chip index up 86.03 points to 6160.79.

United Utilities topped the leader board after a Société Générale rating upgrade from Hold to Buy drove it to a 26.5p gain to 878.875p.

Banks proved resilient to a report from EY warning of rising tax bills as George Osborne’s new surcharge is phased in. Standard Chartered jumped 19.6p to 721p, HSBC rose 12p to 506p and Barclays improved by 4.65p to 257.65p.

Commodity firms were also on the rise, led by Fresnillo, up 12p to 614.5p and Rio Tinto, 40p higher at 2291p.Trustnet Direct market analyst Tony Cross said the sector’s stocks appeared to have found “something of a floor of late”.

On the FTSE 250, Jimmy Choo fell out of fashion with investors after HSBC cut its target price on the stock to 185p. Shares in the luxury shoe-maker, which is fronted by Game of Thrones star Kit Harrington and Ondria Hardin, fell 0.3p to 157.9p.


Out of step: Jimmy Choo

Genus was also down, despite reporting 19% growth in full-year profit. The animal genetics company slipped 12p to 1372.53p, with analysts flagging currency movements and tough end-markets as potential headwinds.

The mid-cap index’s insurers fared better thanks to the ripple effect of the Amlin deal. Lancashire Holdings rose 37p to 690p, Beazley was up 15.5p to 343.2 and Hiscox moved 26.5p higher to 917.5p. Amlin itself was 159.5p, or 32%, higher at 651.67p.

Fitbug, the AIM-listed maker of fitness trackers, saw an unhealthy 0.38p decline in its share price to 2.38p, after chairman Fergus Kee said he was stepping down.

The announcement came just more than a week after the appointment of Anna Gudmundson as chief executive. Two of the company’s non-executives will take over his position while a successor is found.

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September 8, 2015 |
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