FTSE Reshuffle: Marks & Spencer In, Abrdn Out?

High street retailer M&S looks set for a return to the FTSE 100 after a four-year absence

Alliance News 23 August, 2023 | 9:42AM
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Marks & Spencer

Marks & Spencer is primed to make a return to London's premier FTSE 100 index, roughly three years after the founding member was booted out, with abrdn once again among those making way.

That is according to a series of indicative index changes published by FTSE Russell on Tuesday. The indicative changes are published ahead of the final index review, the results of which are reported next week on Wednesday.

High street retailer M&S, currently enjoying a whirlwind run on the stock market with shares up roughly 71% year-to-date, now has a market capitalisation of around £4.30 billion. It had been relegated from the FTSE 100 back in September 2019. It was a founding constituent of the list of London's top-tier stocks and had a 35-year stay there.

Potentially joining it among London's large-cap index will be generic medicines maker Hikma Pharmaceuticals and veterinary drug firm Dechra Pharmaceuticals. Dechra's stint on the stock market could be drawing to a close soon, however. Shareholders have backed a £4.5 billion takeover of the firm by EQT AB, which is a Swedish private equity company, and Luxinva SA, which is controlled by the sovereign wealth fund of the United Arab Emirates.

Technical products and services provider Diploma is also expected to join the FTSE 100.

Among those possibly making way is abrdn, the second year in-a-row that it has been ousted from the FTSE 100 in the third quarter review. It had rejoined before the end of 2022.

Speciality chemicals firm Johnson Matthey, no stranger to a demotion itself, also runs the risk of falling to the FTSE 250 again, industrial and electronics products distributor RS Group also.

Tough housing market conditions have weighed on Persimmon shares, which has fallen about 20% so far this year. The housebuilder also among those at risk of FTSE 100 relegation, according to the indicative changes.

888 Holdings has had a rocky time lately, with its UK gambling licence placed under review after a vehicle backed by former executives of GVC Holdings, now known as Entain , proposed additions to the bookmaker's board. Those proposed additions did not happen.

888 said last week Tuesday, meanwhile, that the review is not expected to have any impact on its operations. It is now odds-on for a return to the FTSE 250.

Greeting card seller and gifting firm Moonpig and oil and gas producer Tullow Oil are also set to return to the mid-cap index.

Construction materials firm Breedon, clean energy technology developer Ceres Power Holdings, and infrastructure and private equity investment manager Foresight Group Holdings Ltd will also join the FTSE 250, according to the indicative changes.

Fresh from floating in July, CAB Payments will also be promoted to the mid-cap index. Shares in CAB, which provides cross-border payments and foreign exchange services, floated at 335 pence on July 6. The stock has fallen since, however, closing at 245.50p on Tuesday, down roughly a quarter from the IPO price. Its market capitalisation of £623.9 million puts it in FTSE 250 contention, however.

Set to make way in the FTSE 250 are outsourcer Capita, trading platform CMC Markets, lender Vanquis Banking, tech investor Molten Ventures VCT, chemicals manufacturer Synthomer and industrial warehouse investor Warehouse REIT .

Liontrust Asset Management is also set for FTSE 250 demotion. The stock has fallen 38% since it announced a deal in to acquire asset manager GAM Holding AG in April.

The indicative changes were compiled using data at the market close on Friday. The actual index review, announced next week on Wednesday, uses data from the market close a week from now.

The quarterly FTSE index review is based on changes to market capitalisation and sees those FTSE 250-listed stocks that are the 90th biggest or larger in the main market automatically move up, and FTSE 100 companies that are 111th biggest or smaller move down, keeping the indices balanced.

 

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Securities Mentioned in Article

Security NamePriceChange (%)Morningstar
Rating
abrdn PLC164.00 GBX0.21
Marks & Spencer Group PLC239.20 GBX-1.52Rating
Tullow Oil PLC28.50 GBX-5.25

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