Tesco’s surprise profit warning has sent supermarket shares tumbling and left the market nursing hefty losses once more.
But there are a couple of bright spots, notably outsourcing group G4S. The company has climbed 7.2p or nearly 3% to 281.2p after Credit Suisse analysts moved their recommendation from neutral to outperform and raised their target price from 245p to 320p. In a hefty note on the business services sector the bank said on G4S:
We think there is significant opportunity within the business to reduce cost and improve efficiency. GFS is, we think, a combination of an attractive multiyear self-help story plus a stock for which organic growth should accelerate into 2015. Our earnings per share estimates rise 7%-11% for 2015- 2016. Our 2015 forecasts are 3% above consensus.
But Capita has slipped 10p to £10.47 as the bank kept its neutral rating but cut its price target from £12.15 to £12.
Overall the FTSE 100 has fallen 71.08 points or more than 1% to 6601.07, with the prospect of a Santa rally seeming fairly distant. The index is on course for its lowest finish for a month.
Worries about the global economy, following Monday’s disappointing data from China and Japan and growing concerns about the eurozone – with Greece calling snap presidential elections after failing to exit its bailout programme – continue to unsettle investors. A drop in the Chinese currency on talk the country’s central bank will take more measures to stimulate the economy has also led to further volatility, while the recent drop in the oil price puts commodity companies under pressure .
via The Guardian 
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