A pair of profit warnings meant IT contractor Scisys (LON:SSY) and high pressure product manufacturer Pressure Technologies (LON:PRES) were the biggest fallers on a disappointing day for equities.
Pressure Technologies narrowly beat out Scisys for the title of ‘biggest loser’ as it said the persistent weakness in the oil price meant companies in the sector were reducing their spending on new projects.
“In the near-term, the low oil price is having an adverse impact on order intake from that sector. This will negatively affect the Group's results for the financial year,” the company said.
Meanwhile, IT developer Scisys issued a severe profit warning, admitting it may breach its banking covenants.
Scisys said the combination of underestimating the size and complexity of one of its projects and adverse currency headwinds would “lead to a substantial short fall in profits for 2015.”
Chairman Mike Love said the warning was “deeply regrettable and wholly disappointing.”
Scisys’ shares eased 29% to just under 58p while Pressure Technologies dropped 30% to 190p.
Elsewhere, the FTSE 100 fell by 1.35% to 6,856 with all sectors in negative territory.
Investors waited for any news of a Greek debt deal with tomorrow’s payment to the International Monetary Fund unlikely to be paid without financial support from its creditors.
Johnson Matthey (LON:JMAT), the world's largest maker of auto catalysts, fell 3.4%, among the top FTSE 100 fallers.
Some analysts were worried about its debt levels, while others trimmed forecasts because the company is disposing of its research chemicals unit and booking higher pension service charges, while its metals unit has been weak.
While most areas of the business performed well, precious metal product sales fell 9% and underlying profit for the sector dropped 21% on weaker markets and the sale of its gold and silver refining business. Shares eased 4.5% to 3,359p.
Many of the other top fallers were trading ex-dividend, with National Grid (LON:NG.) and AB Foods (LON:ABF) trading 1.8% lower to 871p and 2,920p respectively.
On the other side, Kingfisher (LON:KGF) was the biggest riser on the index fter an upgrade to ‘neutral’ from ‘underperform’ by Bank of America Merrill Lynch. Shares rose 1.7% to 374p.
In the mid cap space, city traders continue to speculate that Paddy Power or private investors could table a 175p per share offer for Ladbrokes (LON:LAD).
Shares in Ladbrokes rose for a second straight day, climbing 2.6% to 125p.
Meanwhile, Moneysupermarket.com Group (LON:MONY) said the U.K. energy regulator was looking into whether to include it in a competition probe. Shares dropped 9% to 278p.
OFGEM has already decided not to investigate fellow price comparison website uSwitch, which home seller Zoopla (LON:ZPLA) officially acquired earlier this week for £143mln in initial cash, but it hasn’t stopped the company being tarred with the same brush. Shares in Zoopla dropped 5.5% to 259p.
In small caps, 88 Energy (LON:88E) said excellent drill results had been reported near to its Icewine site in Alaska. Shares rose 50% to 1.09p.
Midatech (LON:MTPH) will significantly increase its footprint in the US and in cancer care with the acquisition of Nasdaq-listed DARA Biosciences for up to £19.5mln. Shares rose 6% to 309p.
Helium Special Situations Fund has increased its stake in Coms (LON:COMS) from less than 11% to more than 15%. Coms recently exited the telecoms business, selling a chunk of its business to Timico for £2.5mln. Shares jumped 11% to 0.6p.