FTSE reshuffle: British Land booted off premier index while Ocado dodges demotion
Online grocer Ocado has dodged relegation from London’s FTSE 100 while property firm British Land lost its coveted spot among the blue-chip stocks.
Fashion retailer Asos also faced demotion from the FTSE 250 ranks, according to the annual review by data firm FTSE Russell.
Ocado was expected to drop off the UK’s top index after suffering a share price slump and widening losses.
However, the firm managed to keep its place ahead of the FTSE reshuffle deadline after its partner Marks & Spencer pleased investors with a better-than-expected yearly profit.
Ocado’s retail business is run as a joint venture with the upmarket retailer.
Susannah Streeter, head of money and markets at Hargreaves Lansdown, said: “Ocado was lifted up on the coattails of M&S resilience last week.
“Although their joint venture has been struggling, M&S has staged a slick recovery and still spies further potential with their partnership.
“This announcement gave Ocado’s share price a little bit more wind in its sails.”
Instead, British Land was knocked into the lower ranks of the FTSE 250 amid a downturn in the housing market.
The firm said earlier this month that it had significantly written down the value of its property portfolio after a prolonged cycle of interest rate rises.
The group fell to a £1bn statutory loss in the latest year as a result, against a profit of £965m a year earlier.
In its place, newcomer IMI, formerly Imperial Metal Industries, enjoyed a bump up from the FTSE 250 to sit among the top 100 stocks.
The Birmingham-based engineering firm has seen its share price surge by more than 20 per cent over the year to date and lifted its full year earnings expectations after a strong first-quarter performance.
Fashion giant Asos fell from the FTSE 250 after sinking to a loss of more than £84m over the first half of its financial year.
Streeter said: “The retailer has badly stumbled amid the cost-of-living crisis, tripping off the pandemic highs it reached when e-commerce became the queen of shopping during Covid.
“It’s taking steps to shore up its balance sheet and has unlocked hundreds of millions in new loans and credit facilities, but this is a painful period of adjustment.
“It will really need to see inflation subside before its core customers will return to splashing the cash.”
Outsourcing firm Capita is among the companies to be elevated from the FTSE Small Cap into the FTSE 250.
The reshuffle was based on data at market close on Tuesday.
Anna Wise, Press Association