MARKET REPORT: Tory peer Lord Cruddas £60m poorer as CMC shares collapse after fall in clients

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Conservative peer Lord Cruddas and his wife saw nearly £60m disappear from their fortunes due to the fall of CMC Markets.

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The wealthy businessman who founded a trading firm in 1989 has watched the value of his stake drop as clients, struggling to cope with inflation and war in Ukraine, leave the platform.

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In an update in the six months to the end of September, CMC reported that the number of merchant customers was down 7% and it was suffering from rising costs.

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CMC said the number of merchant customers fell by 7% and it is suffering from rising costs.

CMC has benefited from a surge in trading activity during the pandemic as Britons looked for ways to make money and pass the time. But as quarantine restrictions eased, activity on the investment platform declined.

And his expansion projects turned out to be more expensive than expected. Operating expenses amounted to £106.3m, up 28% year-over-year. Shares fell 12.7%, or 34 pence, to 234 pence.

Cruddas, a former Tory party treasurer and donor, and his wife Fiona own a 62% stake in the £407.5m company.

The FTSE 100 fell 0.25%, or 18.25 points, to 7351.19 and the FTSE 250 fell 1.77%, or 343.48 points, to 19,112.40, with defense stocks gaining after after a Russian-made rocket killed two people in Poland near the border with Ukraine.

The strike raised fears that Poland, a member of NATO, could be drawn into the war. But President Andrzej Duda said: “There is no indication that this was a deliberate attack on Poland.”

NATO Secretary General Jens Stoltenberg also said a Ukrainian air defense missile was the likely cause, although “Russia bears ultimate responsibility” for the attack on Ukraine.

BAE Systems added 4.2%, or 31.2 points, to 769.8 points, while Babcock added 0.1%, or 0.4 points, to 280.8 points.

Software giant Sage ended the financial year in style, with revenue up 5% to £1.95bn in the year to September and its cloud business up 24%. Shares added 7.3%, or 55.4 pence, to 811.2 pence.

Mr. Kipling and owner Bisto Premier Foods grew in the first half of the year through Oct. 1 as more consumers stay at home rather than eat out. Revenue rose 6.2 percent to £419m, while profits increased by more than a tenth to £47m. But shares fell 2.3%, or 2.6 pence, to 108.4 pence.

Stock watch: Kromek

Kromek has awarded a nearly £5 million contract to the UK government department for “biohazard detection systems”.

The Durham Group makes products that can identify cancerous tissue, wearable nuclear detector kits and dirty bombs.

Boss Arnab Basu said: “We believe that technologies that can provide near real-time information about emerging threats will be a critical component of the strategy.”

Shares rose 14.2%, or 1.15 pence, to 9.25 pence.

The value of the British Land estate fell 3 per cent to £9.6 billion on rising interest rates as it fell 1.1 per cent, or 4.4 pence, to 391.7 pence.

At Vodafone, investors have welcomed the telecommunications giant’s launch of a share buyback program worth up to £580m. It rose 1.3 percent, or 1.27 pence, to 97.16 pence.

Meanwhile, Hill & Smith welcomed strong demand after the safety barrier maker said earnings for the year should top £89.7m. It rose 5.3%, or 58 pence, to 1,150 pence.

Serco went into the red despite having won a £200 million contract with the Ministry of Defense to provide services to the Royal Navy. Its share price fell 0.7%, or 1.2 pence, to 164.9 pence.

Tullow Oil fell 0.4%, or 0.2 points, to 47.3 points after the energy company’s production forecast was a year behind 2020 levels.

Production is expected to be between 61,000 and 62,000 barrels of oil per day by the end of 2022 – up from the previous range of 60,000 to 64,000 and slightly below 74,900 in 2020.

Kainos shares rose 4.8%, or 69p, to 1,510p after Berenberg upgraded the IT firm’s rating from Hold to Buy and raised its target price from 1,200p to 1,700p.

Shares in Deliveroo fell 7.1%, or 7.02 pence, to 92.58 pence after a seven-year stint in Australia. The online delivery company placed its subsidiary there into voluntary management as it said the business could not become profitable without a “significant financial investment”.

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