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Market Wrap - Midday

WPP full year downgrade looms over FTSE 100

23 August 2017 11:56

WPP (WPP) downgraded its full year forecasts, with its like-for-like revenue growth forecast for 2017 downgraded from 2% to between zero and 1%.

Shares in the company slumped 11.4% to £14.09.

The underwhelming performance was blamed on lower sales in all regions except the UK, Latin America and Central and Eastern Europe.

The results have wider implications as advertising spend is often seen as a good indicator of the health of the wider economy.

Elsewhere in the FTSE 100, the housebuilding sector remained under pressure and offset gains in healthcare stocks.

Barratt Developments (BDEV) and Persimmon (PSN) slid 1.3% and 0.6% to 608.5p and £25.77, respectively.

The blue-??chip index was flat at 7,381.

Brent crude oil declined 0.4% to $51.65 per barrel.

Gold remained unmoved at $1,285 per ounce and copper was down 0.6% at $6,547 per tonne.


US House Speaker Paul Ryan's comments that tax reform would be easier to pass than the failed healthcare repeal boosted investor sentiment, causing the Dow Jones to trade 0.9% higher overnight.

Typhoon Hato in Hong Kong halted trading in the Hang Seng index this morning, while the Nikkei 225 in Japan advanced 0.2% to 19,434.


NMC Health (NMC) was among the mid cap risers in early trading, up 3.8% to £25.14 as reported revenues surged by 34% to $775.2m in the first half of 2017. The private healthcare provider also signed a new operation and maintenance contract for the management of its Emirates Healthcare assets.

Playtech (PTEC) agreed to acquire technology, intellectual property and certain customer assets from ACM in a bid to boost its financials division's B2B offering, but this failed to excite investors as the stock was flat at 996p.


Video games retailer GAME Digital (GMD) was encouraged by recent growth in the UK and Spanish markets, triggering a share price rally of 33.8% to 32.8p. The company said it expects this momentum to continue into its peak trading period, driven by strong demand for the Nintendo Switch, the upcoming Microsoft's Xbox One X and new games releases.

A return to profit in Costain's (COST) natural resources division boded well for the company as the shares bounced 2.1% higher to 450.2p. Overall sales were up 10.5% to £874.5m, which beat broker Liberum's forecast of £794m.

New investment for Highlands Natural Resources (HNR) from an undisclosed oilfield services provider for the East Denver project prompted investors to mark the stock 10.3% higher to 25.2p.

Shares in Laura Ashley (ALY) were down 5.8% to 8.2p after like-for-like sales fell 3.1% in the 52 weeks to the end of June.

EnQuest (ENQ) disappointed the market after announcing overall average daily production for the full year 2017 is anticipated to be in line with the first half 2017 production rate, plus or minus 10%. The stock dropped 8.6% to 29.2p.

Packaging firm Robinson (RBN) declined 9.5% to 113.5p as higher costs hit profit margins and demand for its premium products fell.

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