MARKET REPORT: Hut Group shares rally as Qatar and Moulding up stakes

Investors in The Hut Group (THG) were only given a day after the fourth-largest shareholder announced it was dumping its entire stake.

In a ray of hope for the struggling online food and beauty retailer, shares in THG rose 9.8 percent, or 4.48p, to 50.32p.

The rally came a day after Softbank said it sold its 6.4 percent stake to THG founder Matthew Molding and Qatari investors at a hefty discount.

More than 80 percent of the Japanese conglomerate’s shareholding will be swallowed up by the Qatari sovereign wealth fund, with the rest bought by Molding, which already has a nearly 15 percent stake worth £95 million.

THG said the founder’s move is “further proof of his commitment” to the company, but the news brought mixed reception from the city.

Canaccord Genuity gave a “buy” rating and target of 81p on THG stock, saying the food and beauty companies have “advantages” over the competition.

But JP Morgan analysts pointed out that the sale of Softbank’s stock at 39 pence a share represented a 15 percent discount from Monday’s closing price of 45.8 pence.

The broker reiterated its “neutral” rating, adding that it struggles to see how to increase THG’s share price.

THG floated to 500 pence per share in September 2020 – worth around £5.4 billion. It is now worth just £650 million.

The FTSE 100 rose 0.2 percent or 16.5 points to 6936.74 and the FTSE 250 rose 0.2 percent or 26.47 points to 17529.31.

“Investors appear to be optimistic again after the government policy shift and hope that the new earnings season that started last week may not be as bad as feared,” said AJ Bell investment director Russ Mold.

Advertising giant WPP rose 0.9 percent, or 7p, to 760.8p after Morgan Stanley raised its share price target to 700p.

Meanwhile, shares in Mike Ashley’s Frasers Group fell 0.7 percent, or 4.5 pence, to 653.5 pence, despite the retailer meeting the threshold it needed from MySale investors to close the acquisition of Australian company. to seal the company.

Sports Direct owner House of Fraser and Jack Wills has made an offer of £13.6 million or 2 pence per share to acquire the remaining shares it does not already own.

Among the mid-cap stocks, shares in brick maker Ibstock rose 4.9 percent, or 7.4p, to 159.1p after it greeted positive trading in its clay, concrete and futures businesses.

Based on encouraging results in the three months to the end of September, the group now expects to exceed its previous profit estimates for the year.

Shares of MoneySupermarket rose 5.3 percent or 10.6p to 209.2p after the comparison website praised its role in helping households save while customers shopped to find the best deals.

The group expects its profit for the year to be at the top of its range of £108.5 million and £115.5 million, after strong trading in the three months to the end of September.

888 stocks gained 1.3 percent, or 1.2p, to 91.4p as the online gambling group passed tougher betting rules.

While this played a role in the 7 percent drop in sales to £449 million for the three months to the end of September, the group expects earnings for the year to be in line with expectations.

At recruiter Page Group, shares rose 2.8 percent, or 11.6 pence, to 429.6 pence after it announced it would be hiring its own staff.

Nick Kirk will become CEO on January 1, 2023, upon Steve Ingham stepping down on December 31, having been in charge since 2006.