Proactive Investors -
- FTSE 100 up 3 points at 7,575.
- AstraZeneca (NASDAQ:AZN) and Rolls-Royce (LON:RR) lead losses, Ocado (LON:OCDO) and Frasers climb.
- Tritax and UK Commercial Property to merge.
AstraZeneca and Rolls-Royce drag FTSE 100 lower
Losses by Rolls-Royce Holdings PLC and AstraZeneca dragged the FTSE 100 lower come Monday lunchtime.
AstraZeneca found itself still reeling from a disappointing earnings release late last week, with brokers having punished the pharmaceuticals giant over an unchanged dividend and lack of research and development newsflow.
AstraZeneca downgraded as analysts highlight ‘underwhelming’ year-end
Indeed, shares slipped a further 1.9% on Monday, following losses last week, with Barclays (LON:BARC) noting the stock now presented an opportunity.
“The last time AstraZeneca moved that much on a print, the magnitude of the earnings per share miss [and] subsequent downgrades were far greater,” the bank said on Monday.
“We think this presents a compelling entry point for a best-in-class company.”
Barclays reiterated an ‘overweight’ rating for the firm as a result, alongside offering a share price target of 12,500p - a prospective rise of 28% on Friday’s close.
UBS brokers were less optimistic though, highlighting fears of accelerating costs at AstraZeneca, which prompted a repeated ‘sell’ rating and a lowered price target of 9,900p.
Rolls-Royce dipped 3.5% on Monday meanwhile, following gains of almost 50% over the past six months.
The FTSE 100 retreated 13 points to 7,558 as a result of the two heavyweight’s declines, with losses by NatWest (LON:NWG) also contributing.
NatWest knocked lower, £350mln banker bonuses rumoured
Shares in the lender sat 1.7% lower following a weekend Sky News report that the government-backed lender intends to pay out £350 million in staff bonuses before its impending retail share offer later this year.
Here are some of today's small-cap risers
Artemis Resources Ltd (LON:ARV) was a top mover in the junior mining segment, moving upwards 12.7% after today providing an exploration update on its projects in West Pilbara, focusing on the potential of its Kobe and Osborne sites for lithium extraction.
Recent drilling has revealed sub-vertical orientations of pegmatites at these locations, with one drill hole possibly stopping short of the Osborne target.
Fabless chipmaking small-cap Sondrel PLC (LON:SNDS)’s surprise rally on the AIM market showed no signs of slowing down on Monday as shares climbed a further 27.5%.
Late last week, a Daily Mail feature quoting “a source with knowledge of the matter” revealed that Sondrel played a key part in developing Tesla boss Elon Musk’s brain-computer interface Neuralink.
And finally, Malvern International (LON:MLVN) rose 5% after the UK education group announced revenues this year would be up 79% to £11.3 million.
The AIM-listed group is also expected to post an underlying profit of £300,000.