Poor old Ross McEwan. Royal Bank of Scotland’s new boss hasn’t even got his feet under the table yet, but respected banking analyst Ian Gordon reckons he’s already walking up the hill backwards, as David Bowie once said.
“RBS shares have (understandably) responded well to the appointment of McEwan and a wave of speculation that the worst excesses of the Government’s threatened ‘good bank/bad bank’ split may yet be avoided,” Investec’s Gordon said today.
“We hope sense will prevail, and that this proves to be the case. However, we still believe that even the current status quo offers a painfully slow pace of recovery with estimated return of equity of 0% in 2013, 3% in 2014 and 5% in 2015. RBS’ valuation appears full ahead of actual recovery.” The downgrade from hold to sell hit RBS shares, with the state-owned lender falling 6.2p to 334.4p. Welcome to the big time, Ross.
Overall, the FTSE 100 index looked on course to end the week in negative territory for the second week in a row. The market was down 3.53 to 6479.65 following its worst intraday fall in nearly two months because of events across the Pond. Further down the scale, investors fled IT consultant Anite after the company described trading in the first quarter of the year as being “relatively quiet”.
“Following a strong close last year, the handset-testing business has had a slow start to the current year, with momentum in order intake building gradually,” George O’Connor at Panmure said. “The phasing of this, and a relatively low opening product backlog at the start of the period, has meant that revenue and adjusted operating profit in that division was down year on year.”
Elsewhere, Sports Direct, the UK sportswear retailer controlled by Mike Ashley, had a day to forget as its shares slipped 7p to 640p. The sports equipment giant has been a stock-market darling of late but billionaire Ashley will not have enjoyed his lunchtime pint ahead of the new football season starting for his Newcastle United on Monday.
Avon Rubber shares fell 12.55p to 476p despite the group saying it expected full-year results to be in line with market expectations. You can’t please everyone it seems.
