ITV is the biggest faller in the leading index following news one of its institutional investors has cut its stake and talk of a weak advertising market.
Legal & General said it had reduced its shareholding from 3.95% to below 3% after a share sale on Tuesday. The news has sent the broadcaster 3.3p lower to 74p.
Meanwhile Ian Whittaker at Liberum Capital said that conversations with media buyers suggested July and August may be difficult months. Even though the company dislikes the market's fixation with such short term signs, Whittaker said:
The indications we are hearing suggest the July and August TV advertising markets may be weaker than expected with reports some advertisers have cancelled planned campaigns. The TV advertising market could be down 10% or more in July, with ITV Family slightly ahead of this; for August, there is a smaller decline (market down around 5% and ITV family down 3%-4%) with a smaller still decline in September ( down 2% market, down 1% ITV Family). This would imply ITV Family down around 4% or more in the third quarter versus earlier indications of 4% growth.
Elsewhere Admiral has fallen 19p to £11 after the Office of Fair Trading provisionally called for an investigation of the car insurance market by the Competition Commission. Andy Hughes at Exane BNP Paribas said:
We expect prices to fall to reflect the lower cost of claims in future putting more pressure on Admiral's revenue - we remain underweight. We believe Admiral is significantly overvalued and our target price [of 835p] reflects 25% downside.
