ITV faces exit from FTSE 100
Mobile phone retailer Carphone Warehouse and broadcaster ITV are in danger of being ousted from the blue chip FTSE 100 at its next quarterly review.
The two will join pub chain Enterprise Inns and Ukrainian iron ore producer Ferrexpo, which have both fallen below 111th position in the FTSE ranking, based on their market capitalisation, meaning automatic deletion unless their share price stages a dramatic recovery before the end of trading on 9 September when the decisions are made.
Calculations, based on last night’s close, suggest that technology firm Autonomy, communications group Inmarsat, water company Pennon and Mexican mining company Fresnillo will be be promoted in to the FTSE 100 in their place.
Any company falling below 111th position or below is usually deleted from the FTSE 100 in its three monthly reshuffle, with any company rising above 90 automatically promoted.
The changes will be based on the companies’ market capitalisation at the end of 9 September, with the changes effective from the start of trading on the 22 September.
Typically, joining the FTSE 100 boosts a company’s share price because of the large number of tracker funds, popular with pension funds and retail investors, which need to own all shares in the index.
Both Carphone and ITV are in sectors being hardest hit by the current economic slowdown as both advertising and retail spending have been drastically reduced.
