Man, the hedge fund group, has fallen back after it warned of a fall in profits as clients removed their cash following poor performances from its flagship fund.
The company's shares have slipped 2.8p to 239.9p as it said full year profits to the end of March were estimated to be $510m, down from $743m last year. Chief executive Peter Clarke admitted:
The fourth quarter has seen a decline in funds under management, driven principally by the negative performance of AHL in December. Reflecting that private investor sales in the quarter were lower, although redemptions have continued to fall back towards their historically low levels.
Analysts at Credit Suisse put a neutral rating on the shares, saying:
We believe Man group's valuation is inceasingly attractive but believe that more certainty and visibility on private flows are required for the the shares to start outperforming again.
Evolution Securities was more positive, keeping a buy recommendation and 330p target price, saying Man was likely to share in the growing demand for hedge funds in 2011.
Overall, ahead of the budget, the FTSE 100 is drifting higher, up 11.08 points to 5684.71. Owen Ireland at ODL Securities said:
Today's market direction may well be dominated by the release of the Budget. With the general election in the UK looming, this could be a pivotal day for the British economy. Market traders will be keen to see strong leadership in order to reduce the deficit, and measures to avoid the so-called 'double-dip' recession.'
