MARKET REPORT: Burberry falls again as fashion week excitement fades

Burberry’s troubles showed no sign of easing as concerns grew over its status as a luxury brand.

Analysts at Jefferies said the company’s business direction remained unclear just days after it unveiled its latest collection at London Fashion Week.

The broker added that Burberry received mixed reviews because its shift towards “accessible fashion” lacked a “wow factor.”

It is the latest blow for the company, which was already under enormous pressure after replacing its chief executive over the summer and being ousted from the FTSE 100.

According to Jefferies, trading is unlikely to get easier due to the slowdown in China, reduced travel spending and continued uncertainty in the United States.

As a result, the broker downgraded Burberry from “hold” to “underperform” and cut its target price by 310 pence. Shares fell 3.5 per cent, or 22 pence, to 604.4 pence, taking losses for the year to almost 60 per cent.

London’s major markets gave back yesterday’s gains, with the FTSE 100 down 1.2 percent, or 98.73 points, at 8,229.99 and the FTSE 250 losing 1.6 percent, or 330.87 points, to 20,831.84.

Private equity firm Bridgepoint was among the biggest fallers after an investor sold almost 15 million shares at a discount. Shares in the group, which has owned Burger King in the UK since 2017, fell 11.4 percent, or 43.6 pence, to 339.6 pence.

Close Brothers also came under pressure after RBC analysts said the commercial bank’s share price was likely to “travel sideways” until there was clarity on the historic auto finance claims.

The firm has set aside costs to cover potential payouts as the City watchdog is expected to provide an update on the industry-wide review in May next year. As a result, RBC cut its target price on the shares from 620p to 540p. The shares fell 13.5 per cent, or 67p, to 431p.

Card Factory went in the opposite direction following a brokerage rating upgrade. UBS analysts said the card and gift retailer offers low growth but resilient cash generation and potential for significant shareholder returns.

The Swiss-based bank raised its rating to “buy” from “neutral” and increased its target price from 116p to 180p.

The shares, which have risen almost 30 percent this year, added 6 percent, or 8 pence, to 141 pence. Strong growth at rival Moonpig and potential cash returns prompted UBS to initiate coverage with a “buy” rating and a 350 pence target price.

Shares rose 0.5 percent, or 1 pence, to 206 pence, taking gains for the year to more than 30 percent.

Exhaust fan maker Volution soared after announcing its biggest-ever deal.

The group will buy Australian ventilation specialist Fantech for £144m. Shares rose 9.8p to 54p, then 608p.

S4 Capital rallied in early trading yesterday, a day after the digital advertising agency warned that lower spending from technology clients would hurt revenue. But they ended the day lower.

The shares, which fell 5.9 percent on Thursday, lost another 0.4 percent, or 0.18 pence, to 42.16 pence at the close of trading.