FTSE steadies; Capita slumps

Britain's top share index steadied after hitting a record high on Thursday, with strong gains in companies such as ConvaTec offset by firms like Capita, which slumped after missing its profit target and announcing the departure of its chief executive. The blue-chip FTSE 100 index was trading flat in percentage terms at 7,383.13 points by 1020 GMT after touching 7,394.61, a new record high. The benchmark index has surged more than 27 percent since a post-Brexit sell-off in June last year.
Capita slumped more than 7 percent, the biggest decliner in the FTSE 100 index, as the British outsourcing group said its chief executive Andy Parker would step down after the group reported a 19 percent fall in 2016 underlying pre-tax profit, missing forecasts again.
After a string of profit warnings and doubts over its strategic direction, Capita said it did not expect sustainable profit growth before 2018. It also suffered after index provider FTSE Russell said that Capita would be demoted from the FTSE 100 index following a sharp drop in its shares in the past months.
"Full year results ... appear close to our downgraded expectations. However, the consequences of recent events are set to continue to impact the group in the current year and we remain cautious," Shore Capital analyst Robin Speakman said.
Capita, which provides IT-enabled services to banks and investors, the national health service, retailers and utilities, has been forced to cut costs and dispose of assets to make its debt more manageable after a period of slower contract awards.
However, broader market losses were negated by sharp gains recorded by some companies.
ConvaTec led the market higher, with its shares surging more than 5 percent after the British medical devices firm reported an 8 percent increase in annual operating profit for last year, helped by a rise in margins.
Miners were also in demand, building on their sharp gains in the previous session on concerns about a shortage of supply and an upturn in manufacturing growth in top metals user China. The UK mining index was up 0.7 percent after gaining 3.5 percent in the previous session.
Among mid-caps, industrial firm Vesuvius surged 16 percent to its highest level since the middle of 2008 after the company announced higher dividend and revenues.