- Index changes to be announced tonight
- Three new names to join the FTSE 100
- Four new faces in the mid-cap FTSE 250
Investors with FTSE tracker funds will be keenly waiting for details of the latest index reshuffle due to be published after the market close tonight.
As well as changes to the FTSE 100 big-cap index there are expected to be several changes to the FTSE 250 mid-cap benchmark and the FTSE small-cap list.
BIG-CAP JOINERS AND LEAVERS
Based on last night’s closing prices, Sam Murphy at investment bank Numis (NUM) expects three firms to be promoted from the FTSE 250 to the FTSE 100 in tonight’s reshuffle.
Even though its share price has drifted back from the recent highs, medical devices firm Convatec (CTEC) is due to join the top flight thanks to its market value of £4.4 billion.
Earlier this month the company posted forecast-beating first half results and confirmed its full year targets.
Also joining the big league according to Murphy is the world’s oldest collective investment company, F&C Investment Trust (FCIT), founded in 1868.
After an impressive rally in its share price from the June lows, the firm now has a market value of nearly £4.7 billion.
The third stock to join the big-cap benchmark is likely to be North Sea oil and gas producer Harbour Energy (HBR), which has seen its shares rally more than 50% from their July low of 300p to give the firm a market value of £4.2 billion.
Most likely to be demoted from the FTSE 100 to the FTSE 250 are:
Investment management firm Abrdn (ABDN), whose consonant-only name change has done nothing to stop the shares hitting new multi-year lows
Kitchen seller Howden Joinery (HWDN), which only joined the big-cap list in March thanks to lockdown-driven demand for home improvements, and
Generic drug maker Hikma Pharmaceuticals (HIK), whose shares are also hitting multi-year lows after its first half trading update disappointed
In addition to tonight’s changes, software firm Avast (AVST) is due to leave the FTSE 100 on 12 September following its takeover by Norton LifeLock, with Murphy predicting fellow takeover target Homeserve (HSV) will take its place temporarily.
MID-CAP AND SMALL-CAP MOVERS
Stocks moving up from the small-cap index to the FTSE 250 are likely to be Bluefield Solar (BSIF) and NextEnergy Solar (NESF), thanks to the rally in electricity prices, together with transport group Go-Ahead (GOG) and clinical-stage biotherapeutics firm Puretech Health (PRTC) says Murphy.
Leaving the FTSE 250 bound for the small-cap world are struggling private equity investment trust Chrysalis Investments (CHRY), Dublin-based convenience food maker Greencore (GNC), specialist lender Provident Financial (PFG), building products firm Tyman (TYMN) and Singapore-based electronic components maker XP Power (XPP).
Meanwhile, joining the FTSE All-Share index for the first time are multi-let specialist Industrials REIT (MLI) and big-box specialist Warehouse REIT (WHR), with financially-challenged Cineworld (CINE) and Made.com (MADE) leaving the index.
Tonight’s changes will take effect after the close on Friday 16 September, so index-tracking funds will to have rejig their portfolios ready for the following Monday.
Disclaimer: The author owns shares in Industrials REIT
