IG suffers on quiet markets as spread-bet curbs loom

Spread-better IG Group took a hammering from the City today as calmer markets hit trading revenues and a regulatory crackdown hangs over the sector.

Shares in the group slid 33p, or 6%, to 491p as IG’s revenues slipped nearly 4% to £117.4 million in the quarter to February 28, leaving it a “lot to do” to hit full-year forecasts, according to Shore Capital’s Paul McGinnis.

Since Donald Trump’s election last November — until this week at least — markets have steadily risen with a lack of the volatility which spread-betting firms thrive on.

IG, which said it had been “a quiet period” in global markets, saw growth in active clients slow, as well as falling revenues per customer.

The business is the biggest player in a spread-betting sector facing a crackdown from the Financial Conduct Authority on the leverage its customers can use, which greatly amplifies wins and losses.

The consultation on the changes — likely to have a drastic effect on profits — closed two weeks ago.

RBC Capital analyst Peter Lenardos added: “In our opinion the regulatory overhang persists as the final regulations in the UK are announced, IG reworks its product offering, and revenue and profits decline… the worst is yet to come.”