FTSE 100 changes

FTSE has just announced the latest changes to the FTSE 100 index.
30 November 2016

The changes will be effective on Monday 19 December 2016.

Russ Mould, investment director at AJ Bell, comments:

“Continence and packaging have trumped gold and construction in the latest round of FTSE musical chairs.  Gold miner Polymetal and builders merchant Travis Perkins have been demoted from the FTSE 100 to be replaced by ConvaTec and Smurfit Kappa. 

“Polymetal’s time in the UK’s premier index only lasted three months as it suffered from the reversal in the price of gold since the US election as investors moved away from safe haven assets in the hope that increased fiscal stimulus will boost markets.  Travis Perkins lasted longer at three years but was hurt by a profit warning in October.

“Market newcomer, ConvaTec only listed in October in a £1.5 billion deal priced at 225p a share but already has a market cap of £4.8 billion.  It is a health care equipment expert specialising in continence and critical care, as well as wound and skin care.

“Smurfit Kappa is a paper-based packaging giant domiciled in Ireland and joins countrymen DCC and CRH in the index. Its promotion represents a remarkable turnaround in fortunes, as the shares collapsed following its 2007 flotation to barely 140p in 2009, weighed down by the recession and hefty debts. Smurfit Kappa has since bounced back strongly to almost £18 a share, buoyed by a reduction in its net debt pile from nearly €5 billion to barely €3 billion, selective acquisitions, the resumption of dividend payments in 2011 and a consistent improvement in trading profit.”

Full changes can be found here: http://www.ftse.com/products/index-notices/home/getnotice/?id=1882021

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