SHARES of British Airways went into a nosedive today as the fallout from this week’s chaos at Heathrow caused by industrial action began to be felt.
The national carrier fell 31/2p to 1691/2p, after touching 1623/ 4p, as more than 14 million shares changed hands. The dispute centres on the introduction of swipe cards for ground crew to monitor working hours.
Talks between BA and unions broke down in the early hours and further costly industrial action is imminent.
Last weekend’s strike, described as a PR disaster, is estimated to have cost BA between 20 million and 40 million in lost revenue. It is now taking a heavy toll on the shares. Brokers say a long dispute may see BA lose its opportunity to regain its FTSE 100 place in September’s reshuffle.
Newcomer Yell is still finding the going hard.
Floated earlier this month at 285p, it rallied 1p to match the original offer price but buyers remain thin on the ground. The float of the Yellow Pages directory group was the biggest in two years, the shares offered exclusively by its financial advisers Goldman Sachs and Merrill Lynch to institutional investors. It has traded as high as 306p, on the first day, and as low as 2763/4p.
Share prices came off the boil following another dull start to trading on Wall Street this afternoon. The FTSE 100 index rose 4.4 to 4084.1.
Reuters rallied 51/2p to 2061/4p on further consideration of yesterday’s interims, showing the cost-cutting group back in the black.
US securities house Morgan Stanley has repeated its overweight stance and raised its target price 10p to 240p. Rival Goldman Sachs has an outperform rating on the shares with fair value of 246p. It has also raised its earnings estimates.
Hedge fund Lansdowne Partners Limited Partnership has bought an extra 180,000 shares in Manchester United, down 41/4p at 1563/4p, raising its total holding to 16.65 million shares, or 6.03%. Wembley stood out with a rise of 48p to 701p following reports that Bank of Scotland, part of HBOS, may want to team up with Active Value to make a bid for the gaming group.
Software specialist Isoft Holdings rose 201/2p to 3271/2p with rival Torex adding 25p to 5621/2p on further reflection of their proposed 700 million merger to create Britain’s leading provider of healthcare information systems. The enlarged group hopes to scoop a bigger slice of the 2.3 billion NHS modernisation programme.
AIM- listed Savoy Asset Management, where former Chancellor Sir Kenneth Clarke is chairman, jumped 221/2p to 130p. It has recruited 10 fund managers, previously with SG Investment Managementwho bring with them funds under management of 300 million, producing a top- line profit of 5 million. It brings the total amount of funds at Savoy to almost 1 billion. The news came as Savoy reported a narrowing of losses from 341,228 to 312,743.
Life assurer St James’s Place Capital tumbled 161/2p to 1131/2p as broker Merrill Lynch turned seller ahead of interims which are expected to make depressing reading.
Invensys nudged up 2p to 271/2p after the engineering group said it was still difficult to predict any recovery. Rival FKI slid 61/ 2p to 96p after revealing its trading performance had deteriorated over the past six weeks.
. Prices and indices in this section are supplied from various sources and calculated at different times and may not always match those listed in the tables. Ofex prices relate to the previous close.
