FTSE 250 movers: Nostrum drives market down as target price slashed

After a five day streak of rises, the FTSE 250 started this week in the red, down 77.07 points (0.45%) to 17,112.04 by mid-afternoon Monday.

Nostrum Oil and Gas was the biggest faller after RBC Capital Markets downgraded the stock from ‘outperform’ to ‘underperform’ and slashed its target price from 800p to 300p. The investment bank said while it believed there is long-term value in the company, it downgraded it until its 2016 plans and near-term operational momentum becomes clear. “Into flat/declining oil prices (compounded by Tenge devaluation), we believe Nostrum faces a decision between either a material dividend or sufficient development drilling in 2016 to maintain 2017 growth (both impact the fundamental investment case).”

Playtech also saw a large drop after it announced it was scrapping the acquisition of Plus500, with a second proposed deal for Ava Trade hanging in the balance. The gaming company announced on Monday that it received an update from the Financial Conduct Authority (FCA) late on Friday with a number of concerns. It said the steps it would need to take to address concerns would not “sufficiently satisfy the FCA” to get approval by the 31 December deadline and pulled the plug on the acquisition. As a result, and with the Central Bank of Ireland opposing it, Playtech said there’s now an increased risk of its proposed acquisition of Ava Trade not going through.

Mitie Group took a hit after it posted a drop in interim operating profits. The company said it was due to the deterioration of performance in its healthcare arm and as it exited unprofitable contracts in that segment. Headline operating profits fell by 9.5% to reach £58.1m, but the management was confident of its ability to deliver a "good" full-year performance.

Meanwhile Home Retail Group led the risers following reports over the weekend that it is "being circled by potential buyers" after its recent profit warning. According to an unsubstantiated article in the Sunday Times, various industry experts have been called on to advise on potential private equity approaches, with Home Retail's board said to be on the alert for an offer. Investment banks RBC Capital Markets and Investec said such reports were credible and not surprising given the recent weakness in the shares and valuation support that lies within the group, notably its net cash position of close to £200m and fully-funded net loan book that will top £600m by year end.

Premier Oil also helped stem negative market flows after AIM-listed partners Falkland Oil & Gas and Rockhopper Exploration confirmed it has begun re-drilling the Isobel well in the North Falkland Basin, just south of the contentious Sea Lion field off the Argentinean coast.

FTSE 250 - Risers

Home Retail Group (HOME) 108.50p 4.93%
Premier Oil (PMO) 74.20p 2.42%
Clarkson (CKN) 2,273.00p 2.07%
Bank of Georgia Holdings (BGEO) 1,874.00p 1.79%
Vedanta Resources (VED) 389.10p 1.73%
AO World (AO.) 157.90p 1.54%
Spire Healthcare Group (SPI) 283.80p 1.39%
AL Noor Hospitals Group (ANH) 1,169.00p 1.21%
Just Eat (JE.) 425.30p 1.02%
UDG Healthcare Public Limited Company (UDG) 524.50p 0.96%

FTSE 250 - Fallers

Nostrum Oil & Gas (NOG) 354.90p -8.88%
Playtech (PTEC) 784.00p -7.93%
Mitie Group (MTO) 309.00p -6.96%
Poundland Group (PLND) 211.10p -6.47%
Evraz (EVR) 82.20p -4.20%
Enterprise Inns (ETI) 103.10p -3.64%
Diploma (DPLM) 675.00p -3.57%
Close Brothers Group (CBG) 1,425.00p -3.52%
Kaz Minerals (KAZ) 89.70p -3.08%
TalkTalk Telecom Group (TALK) 223.50p -3.08%