Quarterly changes in Trackers drive activity for movers
This is one of those weeks when tracker funds take centre stage. The quarterly changes to the FTSE 100 should see the arrival of Rentokil Initial, Burberry and Segro to the top group and the relegation of Pennon, Foreign & Colonial and Balfour Beatty. Expect activity on these likely movers as trackers buy or sell to get their portfolios in representative shape.
Miners are back in focus as they rose sharply at the end of last week due to encouraging news on economic and jobless data. Lonmin led the risers on the added possibility of a renewed bid by Xstrata when the take over restrictions are lifted in October. Kazakhmys rose on news of an upgrade to overweight by broker Morgan Stanley and set a target price of £13.80 based on their strength in the copper market. Shares closed on Friday at £9.825.
AIM stock PLUS Markets is expected to see some heavy trade today as news that Middle Eastern Investors have acquired 19% of the stock.
World cup hopes for the Home Nations led to Sports Direct shares ending last week with a strong performance. Brokers Oriel Securities rose their outlook for earnings on hopes that the retailer will benefit from strong replica kit sales next summer. Competitors JD Sports focus more on the high end sports apparel market and JJB Sports are still licking their wounds so the field should be clear for a strong performance.
News that the Solvency II proposals were likely to be less stringent for insurers balance sheets helped all major players shares to increase. Peter Eliot, analyst with MF Global, reckons that the impact will be around £14bn rather than the estimated £50bn by 2013.
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