FTSE 250 movers: Cairn Energy, Tullow Oil lead midcaps to new highs

London's FTSE 250 index ended the week at a new all-time high, led by oil companies as crude prices firmed amid heightened geopolitical tension in the Middle East.

Cairn Energy was also higher after announcing after the close on Thursday that it will seeking the authority at next month's shareholder meeting to be able to sell the residual shares in Vedanta as close as possible to the market price.

Following completion of the proposed merger of Vedanta Limited and Cairn India, Cairn's residual interest of approximately 10% of Cairn India will equate to approximately 5% of the Vedanta's equity, which it emphasised represented "a substantial proportion" of the group's assets.

Likewise debt-laden Tullow Oil, as well as being very sensitive to crude prices, continued to rebound since its rights issue shares were issued first thing on Thursday. As UBS pointed out, rights issues themselves do not create or dilute economic value "what matters is how proceeds are deployed" - although the first use of proceeds will be debt reduction which is dilutive to equity.

Aberdeen Asset Management was boosted by an upgrade to 'outperform' by analysts at RBC Capital Markets, who increased their forecasts but maintained the price target at 300p. "We believe risk is to the upside and the shares have over-reacted on the downside. The key negative – ongoing net outflows at both companies – is well known and more than reflected in the share price, while the defensive nature of the merger and potential disruption to the businesses as they integrate is fully understood, in our opinion." RBC sees cost savings could be as much as 50% higher than the stated figure of £200m and that the shares are "attractive to both value and income-orientated investors".

Sophos continued to surge into new highs after Tuesday's trading update, where it confirmed that it finished its financial year just like it started it, with more than 20% growth in billings. Analysts and investors have been impressed, with the shares breaching their all-time high on Tuesday and climbing ever higher. As an example, Citi, which said that Sophos’ strong operational results validate its mid-market strategy, lifted its target price to 380p from 325p. "Given its above-market growth, we believe the shares justify a premium valuation."

Going the other way, Online grocer Ocado was the biggest faller in the mid cap index, dropping more than 5% after analysts at UBS downgraded to 'sell' from 'buy' as they raised doubts over the pace of future growth in the market, with proprietary research indicating online grocery growth halved last year. "In our view, Ocado's limited purchasing power suggests it will struggle to maintain both gross margin and price competitiveness in an inflationary environment."

Ferrexpo continued to decline after the iron ore specialist reported a fall in pellet production during the first quarter of 2017 as a result of maintenance in the first two months of the year.

FTSE 250 - Risers

Cairn Energy (CNE) 216.50p 6.60%
Tullow Oil (TLW) 224.00p 5.56%
Aberdeen Asset Management (ADN) 277.80p 3.93%
Sophos Group (SOPH) 328.60p 3.04%
Polymetal International (POLY) 1,063.00p 2.71%
McCarthy & Stone (MCS) 189.10p 2.60%
Fidessa Group (FDSA) 2,646.00p 2.28%
Centamin (DI) (CEY) 182.80p 2.01%
Cobham (COB) 140.10p 1.97%
Hunting (HTG) 599.50p 1.96%

FTSE 250 - Fallers

Ocado Group (OCDO) 237.90p -5.60%
Ferrexpo (FXPO) 164.60p -3.57%
TalkTalk Telecom Group (TALK) 189.80p -3.26%
Lancashire Holdings Limited (LRE) 640.50p -3.03%
Redefine International (RDI) 36.79p -2.62%
CLS Holdings (CLI) 1,884.00p -2.43%
Vedanta Resources (VED) 810.00p -2.17%
Kaz Minerals (KAZ) 472.70p -1.91%
Galliford Try (GFRD) 1,458.00p -1.75%
Marshalls (MSLH) 360.10p -1.69%