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FTSE 100 movers: Housebuilders rally but NMC hit by broker note

By Michele Maatouk

Date: Friday 11 Jan 2019

FTSE 100 movers: Housebuilders rally but NMC hit by broker note

(Sharecast News) - London's FTSE 100 was down 0.4% at 6,916.66 in afternoon trade on Friday as the pound popped higher.
NMC Health was knocked lower by a note from Jefferies, which said: "We rate NMC as underperform as we do not share market optimism on Saudi and the economics to NMC.

"With higher leverage and our view disclosure is more reliant on management, we believe the market is mispricing growth and increasing execution risks."

Barclays was in the red as Deutsche Bank cut its price target to 207p from 243p as part of a broader note on European banks.

Sage was under the cosh after UBS downgraded the software group to 'sell' from 'neutral', cutting the price target to 520p from 590p as it said the risk-reward was unfavourable and strategic questions remain.

The bank noted that shares are up 17% from their fourth-quarter lows, and while many others in the sector have seen a similar recovery, none has seen a double-digit EPS downgrade since 1 October.

"While management uncertainty is now addressed, neither the new CEO nor CFO brings the "cloud-native experience' sought at the time of Stephen Kelly's departure," UBS said, adding that the company's £40m 'one-off' step-up in R&D investments announced with the FY18 results was likely to be more permanent in nature.

On the upside, housebuilders shone after Bank of America Merrill Lynch upped its stance on the sector to 'neutral' from 'underperform'.

"It seems at least possible, or even probable, that some sort of Brexit resolution is within sight and therefore the UK housebuilding sector may see some relief," it said, as it double-upgraded "top picks" Persimmon and Taylor Wimpey to 'buy', lifting the target prices to 2,400p from 2,200p and to 175p from 160p, respectively.

Merrill also upgraded Barratt Developments to 'neutral' from 'underperform', upping the price targets to 535p from 470p .

FTSE 100 - Risers

Taylor Wimpey (TW.) 156.39p 5.03%
Persimmon (PSN) 2,203.00p 4.36%
Barratt Developments (BDEV) 502.20p 2.66%
International Consolidated Airlines Group SA (CDI) (IAG) 607.80p 2.19%
ITV (ITV) 139.75p 1.75%
British Land Company (BLND) 549.80p 1.59%
London Stock Exchange Group (LSE) 4,337.00p 1.57%
easyJet (EZJ) 1,159.77p 1.56%
Informa (INF) 657.80p 1.48%
Coca-Cola HBC AG (CDI) (CCH) 2,511.00p 1.29%

FTSE 100 - Fallers

NMC Health (NMC) 2,754.00p -6.01%
Melrose Industries (MRO) 168.50p -4.64%
Smurfit Kappa Group (SKG) 2,190.00p -2.41%
Barclays (BARC) 155.58p -2.36%
Rentokil Initial (RTO) 346.40p -2.20%
AstraZeneca (AZN) 5,798.00p -2.11%
Kingfisher (KGF) 222.70p -2.11%
Sage Group (SGE) 608.20p -2.06%
TUI AG Reg Shs (DI) (TUI) 1,172.00p -2.05%
Spirax-Sarco Engineering (SPX) 6,405.00p -1.61%

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