Hargreaves bounces on stable London trading

A more stable London market helped Hargreaves Lansdown bounce on Wednesday.

Hargreaves shares have been volatile ahead of a trading statement due next week, which will be its first to include the April tax-year deadline to invest an Isa.

About 15 per cent of Hargreaves' annual fund flows fall into April as a result, RBC estimated.

But data from the Investment Association, a UK investment management industry body, suggests the usual late rush to invest in Isas was muted this year.

Just £585m went into funds between the start of March and the April 5 deadline, down 29 per cent from 2014, IA data show.

With shareholders expecting Hargreaves' key Vantage fund platform to collect £5.5bn of net flows for 2015, any number below £2.5bn in next week's update is likely to disappoint, RBC said.

Hargreaves ended at £12.21, up 1.9 per cent, which put the stock on a valuation of nearly 27 times 2016 expected earnings.

The wider market steadied after two days of sharp falls, which lifted the FTSE 100 by 0.2 per cent, or 15.83 points, to 6,949.63.

Mondi jumped 8.9 per cent to £14.14 on a reassuring update from the paper and packaging maker, which has been widely rumoured to be a possible bid target. Volumes and pricing had been stronger than expected, Mondi said.

Housebuilders gained after Barratt Developments said sales rates had improved in March and April, allowing it to sell legacy sites more quickly than planned.

Barratt climbed 3.4 per cent to 564p, Persimmon was up 4.1 per cent to £18.20, Taylor Wimpey added 2.4 per cent to 182.3p and Bovis Homes took on 3.4 per cent to £10.35.

Royal Bank of Scotland edged up 0.6 per cent to 353p. JPMorgan Cazenove argued for passive sales of RBS shares by the Treasury, similar to its strategy of dripping its Lloyds stake into the market gradually.

RBS's 21 per cent free float is a deterrent for some potential value investors keen to back management's long-term plan of cash returns, the broker said.

Telecity gained 3.3 per cent to £11.15 on a report that Digital Reality, a San Francisco real estate investment trust, has been "looking seriously" at the bid battle for the datacentre operator.

Equinix last week bid $3.5bn for Telecity, superseding its previous plan to merge with Interxion of Holland.

Compass lost 3.8 per cent to £11.19 after cautioning that the dollar's weakness would be a headwind to earnings.

Management also flagged up that Brazil and Turkey had recently started to weaken and there was a slowdown among oil and gas customers, who account for about 5 per cent of group revenue.

Man Group faded 3.9 per cent to 169.5p as recent volatility continued to take its toll on AHL, the group's trend-following fund set. The funds have slipped around 9 per cent from their high water marks hit in March, having risen only once in the past nine sessions.

Saga edged 1 per cent higher at 201p after Acromas, its private equity backer and majority shareholder, sold an 11 per cent stake at 195p apiece.

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