Shares in Royal Mail hit a two-year low as it remained locked in a union dispute.
The Communication Workers Union (CWU) has announced another 19 days of strikes between October and November at the postal group.
The stock fell 3.5 per cent, or 6.85p, to 187.2p but there was a glimmer of hope after the CWU said Royal Mail had agreed to further talks today. If a solution cannot be found, the strikes will fall on some of Royal Mail’s peak days.
Pay strikes: Royal Mail stock fell 3.5% but there was a glimmer of hope after the Communication Workers Union said Royal Mail had agreed to further talks
Workers want a pay rise but, having made a loss of £92million in the first quarter, Royal Mail last week said the CWU has not outlined ‘viable alternatives that will fund further pay increases’.
It also called for talks to be taken to Acas, the dispute resolution service, alongside modernising the ways it works with the union.
JP Morgan analysts think strikes will spur customers to use rivals, and Peel Hunt reiterated a ‘sell’ recommendation. Royal Mail floated at 330p in 2013. It is now worth around £1.85billion, and its shares have fallen 63 per cent this year.
On another turbulent day in London, the FTSE 100 was up 0.3 per cent, or 20.8 points, to 7005.39 and the FTSE 250 by 0.1 per cent, or 16.86 points, to 17,320.97.
A stark warning from the International Monetary Fund (IMF) was followed by a dramatic intervention in the bond markets by the Bank of England in a bid to restore calm.
Concerns over the health of UK pension funds amid ructions on the bond markets prompted L&G, the UK’s largest provider of workplace pensions, to plunge 5.6 per cent, or 13.1p, to 220.3p while investment group M&G tumbled 6.2 per cent, or 11.1p, to 168p and the insurer Aviva fell 4.9pc, or 19.9p, to 389p.
Stock Watch – CML Microsystems
CML Microsystems rose as a positive update cheered investors. Ahead of its interim results in November, the electronic chip maker said that it has enjoyed ‘strong’ trading for the six months to the end of September.
The AIM-listed firm expects to rake in far more revenue than last year, having enjoyed favourable exchange rates.
As a result, CML said it now expects revenue and profit for the year to be ahead of market expectations. Shares rose 11.7 per cent, or 41p, to 391p.
There was better news for Spirax Sarco after its £307.5million takeover of the US firm Durex, which makes temperature sensors used to build semi-conductors. The engineer, which snapped up Paris industrial heating firm Vulcanic in July, rose 2.5 per cent, or 255p, to 10385p.
Wetherspoons was among the biggest fallers on the mid-cap index – down 4.3 per cent, or 19.4p, to 429.2p – after analysts at Liberum issued a bleak outlook.
Ahead of the pub group’s preliminary results on October 7, the broker slashed the target price to 450p from 600p and said the company’s current trading is likely to have remained ‘subdued’.
Aston Martin hit a record low as the luxury car maker completed its £575.8million rights issue. With analysts uncertain as to whether its huge debt can be lowered, it fell 5 per cent, or 7.55p, to 142.25p.
Airport caterer SSP slid 1.1pc, or 2.3p, to 207.1p after mixed reports from brokers. The firm, which owns Upper Crust and Millie’s Cookies, had its target price raised by Morgan Stanley but lowered by Stifel and Deutsche Bank.
Meanwhile, Credit Suisse cut the target price of Deliveroo to 114p from 130p. But the stocks rose 3.8 per cent, or 3.24p, to 87.8p.
An I3 Energy co-founder has resigned as chief financial officer.
Graham Heath, who helped set up the oil and gas firm in 2014, is leaving immediately. Shares rose 1.8 per cent, or 0.4p, to 23.65p.
Fuel cell maker Ceres Power took a hit after Boston-based Fidelity Investments lowered its holding.
Shares fell 2.1 per cent, or 8.2p, to 383.8p. Amigo Holdings became the latest company rocked by a shareholder revolt over fat cat pay.
At its annual general meeting, 45 per cent voted against the lender’s remuneration report. Shares rose 5.9 per cent, or 0.22p, to 4.02p.
Getech hailed its ‘critical role in energy security’ as it soared 3 per cent, or 0.5p, to 17.25p after its order book hit an all-time high, up 118 per cent to £4.8million in the six months to June 30. The energy software firm said revenue rose 11 per cent to £2.7million.