FTSE 100 movers: Sports Direct falls as shareholder's concerns laid out

Sports Direct was the biggest faller after one of the retailer’s major investors voiced its concerns about its relationship with Nike as well as its website offering.

In comments published by The Sunday Telegraph, which compared it to rival JD Sports, Aviva’s Trevor Green wondered whether the retailer was getting the full range of stock. “A simple walk around the store will give the impression that it is an issue, there is very little in there.” It followed comments from analysts about the company’s focus on bargains which has put pressure on its relationships with major brands. “JD Sports is fascinating in relation to Sports Direct. JD is completely switched on, it is right at the cutting edge of athletic fashion.” The Sunday Telegraph also said Green noted that Sports Direct needs a better website because the customers expect it. Aviva is the company’s sixth largest shareholder.

Housebuilders were hit on the back of data out from real estate website Rightmove that the asking price for UK properties rose by 0.5% in December, the second highest for the period in nine years.

Demand as measured by visits to the Rightmove website in the first working week of 2016 was up by 21% on the same period in 2015 to 27.8m visits. “Encouragingly for first-time buyers there’s more fresh choice with more property coming to market in their target sector. With their asking prices pretty much the same as a month ago, perhaps the knock-on effects of the more punitive landlord tax regime have arrived early and they now face a dilemma over whether to buy now or wait to see if prices drop in this sector over the next few months,” said Rightmove director Miles Shipside. That news sent shares in Taylor Wimpey, Barratt Developments and Persimmon falling.

Sainsbury also failed to thrive after Home Retail Group announced it had agreed to sell its Homebase division to Australia's Wesfarmers.

The £340m sale to one of Australia’s biggest retailing groups, which will see the well-known brand disappear and replaced with Australian and New Zealand brand Bunnings, followed confirmation last week it was in advanced talks. It also followed news at the beginning of the year that the supermarket was still considering making a takeover offer for Home Retail after a November approach for the retail group was rejected.

Miners featured in the market’s risers after JP Morgan Cazenove re-evaluated its stance on the mining sector.

In a note released on Monday, the investment bank said it preferred stocks that offer safety from the storm even if it’s a case of the best of the worst. “Even before recent gyrations caused by China, 2016 was shaping up as tough for Metals & Mining,” it said. “Our recommendation structure reflects a negative bias, with growing risk of capital raisings across the sector.” It added Glencore, already rated at ‘overweight’, to its Analyst Focus List which saw it rise to the top of the market. It also reiterated its ‘underweight’ rating for Anglo American, saying it faces “difficult decisions and uncertain paths to resolving balance sheet issues”.

Shire also rose on the back of a positive broker note. Exane BNP Paribas upgraded the company to ‘outperform’ from ‘neutral’ and reiterated its 5,700p price target following the company’s agreed merger with Baxalta.

It said whether you like the deal or not, the Shire-Baxalta valuation is compelling and it’s time to buy the shares. “Whilst Baxalta may not have been Shire’s best M&A option in our view, it is nonetheless a value-enhancing deal.” Exane said that although the merger with Baxalta does not materially boost Shire’s growth profile in the mid-term, it will provide the longevity of growth and cash flow support that Shire needs as it moves towards patent expiries for drugs Vyvanse (2023), Firazyr (2019/20) and Lialda (2019).

FTSE 100 - Risers

Glencore (GLEN) 74.96p 1.99%
Shire Plc (SHP) 4,259.00p 1.91%
BP (BP.) 344.10p 1.76%
Anglo American (AAL) 235.70p 1.27%
Compass Group (CPG) 1,135.00p 1.25%
ARM Holdings (ARM) 944.50p 1.23%
Mondi (MNDI) 1,197.00p 0.93%
London Stock Exchange Group (LSE) 2,426.00p 0.92%
Royal Mail (RMG) 431.70p 0.89%
Imperial Tobacco Group (IMT) 3,542.50p 0.80%

FTSE 100 - Fallers

Sports Direct International (SPD) 396.40p -3.18%
DCC (DCC) 4,986.00p -3.00%
Pearson (PSON) 690.00p -2.61%
Tesco (TSCO) 160.45p -2.43%
Taylor Wimpey (TW.) 179.60p -2.34%
Barratt Developments (BDEV) 565.00p -2.33%
Persimmon (PSN) 1,874.00p -2.24%
Provident Financial (PFG) 2,905.00p -2.22%
Sainsbury (J) (SBRY) 238.60p -2.17%
Barclays (BARC) 187.75p -2.11%