Market update (PM): Autonomy falls after S&P downgrade
Joe McGrath, 17 January 2011
Prices correct as at market close
An analyst downgrade was sufficient to tumble Autonomy Group today, which quickly became the worst performing share on London’s blue chip index.
Analysts at Standard & Poor’s Equity Research unit slashed the rating from a buy to a hold, ensuring that the share price descended 5.1 per cent to 1,464 pence.
Precious metals miner Fresnillo was the second worst performer, dropping 3.7 per cent at 1,437 pence ahead of chipmaker ARM Holdings which reversed some its recent gains, down 3.1 per cent at 514 pence.
Meanwhile, news that Smiths Group rejected a £2.45 billion bid on Friday for its medical division, sending its shares to the top of the FTSE 100 gains list.
The engineering-to-medical group confirmed it had received the approach as a ‘best and final’ offer that the board carefully considered with its advisers, only to conclude that it was not in the best interests of shareholders at this price.
In a market statement, the company said it had taken into account the quality and highly cash-generative nature of Smiths Medical, both standalone and in the context of a group as a whole.
The company’s share price rose 8.1 per cent as a result of the news, settling at 1,386 pence by the close of the market.
Smith & Nephew was the second highest climber, following ongoing speculation that Johnson & Johnson is still interested in making a higher bid for the group.
The company’s share price gained 3.3 per cent at 707.5 pence by the close of play. GKN completed the top three gains, up 3.1 per cent at 228.8 pence.
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