Markets Edge Higher; Aviva Slides Lower

THURSDAY MARKET UPDATE: Shares in the insurance company Aviva fell by 12.5% after the company slashed its dividend

Alanna Petroff 7 March, 2013 | 6:28PM
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It was a bumpy day in the markets, but the benchmark FTSE 100 index and the mid-cap FTSE 250 index each managed to eke out a 0.2% gain by the close of the trading day. The FTSE 100 edged up by 12 points to close at a fresh five-year-high of 6,439. The FTSE 250 added 30 points and closed at 13,953.

Market Winners and Losers

There was a clear leader and a clear loser on the FTSE 100 on Thursday. Aggreko (AGK) shares rallied by nearly 10.5% after the power provider announced it would hike its dividend. Meanwhile Aviva (AV.) shares plunged by 12.5% after the company slashed its dividend. Aviva cut its final dividend by 27%.

This unexpected Aviva cut comes just after RSA Insurance Group (RSA) also chopped its dividend pay-out. Investors reacted to the news from each company by selling off shares. Investors prize these companies, in part, because of their generous dividend pay-outs.

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Securities Mentioned in Article

Security NamePriceChange (%)Morningstar
Aggreko PLC  
Aviva PLC370.90 GBP0.00Rating

About Author

Alanna Petroff

Alanna Petroff  is a financial journalist with Morningstar UK.