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MARKET REPORT: Lord Cruddas takes £80m hit as CMC shares tumble

Tory peer Lord Cruddas and his wife saw more than £80million wiped off their fortune after shares in CMC Markets plunged by a fifth.

The former Tory party treasurer and donor, who founded the trading firm in 1989, watched his paper wealth shrink after the firm issued a bleak trading update.

‘February and March posed a more challenging environment, with lower equity volumes and a higher proportion of lower-margin institutional trading activity,’ a CMC spokesman said.

Its net operating income for the year to March 31 is expected to be between £280million and £290million.

Tory peer Lord Cruddas, who founded the trading firm CMC Markets in 1989, watched his paper wealth shrink after the firm issued a bleak trading update

But this would be below the £304million analysts expected. And its operating costs should come in at around £215million to £220million, the company added. 

At the interim results in November, CMC said its operating cost ‘remains unchanged’ at £215million. Shares plunged 20.6 per cent, or 47.8p, to 184.2p.

That reduced the value of the 174.15m shares held by Cruddas and his wife Fiona by £83million. Their 62 per cent stake is now worth £320million. 

Shares in Thungela Resources tumbled after the miner warned its shipments would fall for the second year in a row amid ongoing issues at the largest coal exporter in South Africa.

The firm, which was spun off from the blue-chip mining giant Anglo American in 2021, revised its forecasts for this year and failed to provide any outlook for 2024. Shares tumbled 5.1 per cent, or 45p, to 835p.

Thungela attributed much of its woes to the ailing performance of South Africa’s state-owned operator Transnet Freight Rail (TFR).

It has suffered a string of mishaps, from stolen cables preventing its electric trains from being used to a shortage of locomotive spare parts. 

Stock Watch – Scotgold 

MARKET REPORT: Lord Cruddas takes £80m hit as CMC shares tumble

Scotgold Resources warned its future was in doubt and fresh funds were needed to help it stay afloat after output fell short of expectations.

The Scottish Highlands-based silver and gold miner had planned to mine nearly 6,000 tons in February and March.

But it only mined 977 tons in February and expects up to 600 in March. 

There was ‘significant doubt’ over its ability to continue as a going concern in the short term if output remained weak. 

Shares fell 63.4 per cent, or 24.1p, to 13.9p.

The turmoil at TFR means Thungela expects to ship between 10.5m tons to 12.5m tonnes for this year – well below last year’s output of 13.1m tons.

It was not all doom and gloom for Thungela, however. Revenue nearly doubled £2.26billion last year. Its profits jumped to £800million for 2022 from £300million a year earlier.

Such results delivered handsome returns for shareholders, who were paid £610million last year.

Across the sector, mining stocks struggled for direction. Fresnillo (down 1.5 per cent, or 11.2p, to 721.4p), Endeavour Mining (down 0.05 per cent, or 1p, to 1859p) and Rio Tinto (down 0.4 per cent, or 21p, to 5232p) all sank into the red while Anglo American (up 0.04 per cent, or 1p, to 2539p), Glencore (up 1.6 per cent, or 6.9p, to 449.6p) and Antofagasta (up 0.2 per cent, or 3p, to 1520p) made gains.

In a positive start to the week, the FTSE 100 rose 0.9 per cent, or 66.32 points, to 7471.77 and the FTSE 250 gained 0.2 per cent, or 35.79 points, to 18529.62.

 Burberry was among the biggest blue-chip risers after JP Morgan raised the luxury retailer’s target price to 2250p from 2000p.

The broker said it issued the upgrade to reflect the faster reopening in China and better-than-expected demand in Europe. Shares rose 1.7 per cent, or 40p, to 2383p.

Wetherspoons added another 2.6 per cent, or 17.5p, to 677.5p following its trading update at the end of last week where the group swung back into a profit. It means the pub chain’s stock has risen more than 50 per cent this year.

WPP made its fourth acquisition this year after it bought the New York-based social influencer marketing agency Obviously. Shares rose 1.3 per cent, or 12.2p, to 929.6p.

Business looked good for Belvoir after the property franchise group said its mortgage activity has increased by around a fifth since the final three months of 2022.

The group saw its revenue rise 14 per cent to £33.7million in 2022 while profit slid 2 per cent to £9.1million. It hiked its dividend for 2022 by 6 per cent to 9p a share.

Shares ascended 5.1 per cent, or 8.5p, to 174.5p.