Different day, same story: more bad news for internet auction house Qxl.com. Not only did a trust connected with its non-executive chairman sell more shares, but the analyst who stunned the brokerage community by setting a £44 target price made an embarrassing climbdown.
First, the share sales. Yesterday it emerged that New Jersey based Fenwick Trust, of which QXL's non-executive chairman Jonathan Bulkeley is a beneficiary but has no control, sold 500,000 QXL shares at 55p each on Tuesday. Although Fenwick claims the disposals were made to cover the administrative expenses of the trust, dealers were more sceptical, pointing out that Fenwick made a similar move earlier this month.
On August 7, Fenwick also said it had sold 325,000 QXL shares between July 19 and August 2 to cover its administrative expenses.
Whatever the reason for the sales, dealers are starting to get twitchy. Not only are the sales undermining what little confidence remains in QXL, but Fenwick still holds 18.2m shares. Given that it has been selling from 78p downwards, there can be no guarantee that further sales will not follow. QXL shares, which were 1.5p better at 59.5p last night, have already fallen from 778p in the past 10 months.
Meanwhile, SG Cowen analyst Thomas Bock, who drove QXL's share price up six-fold in one day when he first came out with the eye-catching target price back in April, appeared to throw in the towel on QXL.
In a research note, Mr Bock cut his rating on QXL to "hold" from "strong buy" citing recent developments that have created concerns regarding the company's growth strategy, its acquisition of German rival Ricardo.de, and its financial position.
On this last point, Mr Bock, who made no mention of a new target price in the note, said QXL might only be able to finance its operations for another four to five quarters before it needs to raise fresh capital.
Elsewhere, leading shares continued their winning run. The FTSE 100 index closed up 56.5 points at 6,532 - its highest close since June 14 - on a turnover of 1.46bn.
Most of the support came from oil heavyweights BP , up 13p to 615p, Shell , 6.5p stronger at 573. Both were boosted by the strong crude price.
The banking sector also chipped in with Barclays rising 63p to £16.75, while Alliance & Leicester gaining 18p to 550p.
Dealers remain convinced that some form of corporate activity is on the cards at business services group Hays . According to the story making the rounds yesterday, Hays is working to unlock hidden value via a demerger of its recruitment arm. The shares closed up 3.25p at 403.25p, as 7.1m shares changed hands.
On the downside, Rolls Royce , off 10.25p to 228.75p, was the worst blue-chip performer, unsettled by a negative research note from UBS Warburg. In a preview of interim results due on August 24, UBS said that it was expecting a complex set of figures that are likely to contain some and hidden and unpleasant surprises.
British Airways lost 12.75p to 368.75p, hit hard by the withdrawal of Concorde from service and the buoyant oil price.
Lower down the corporate scale, Safeway fell 18.25p to 282p, as CSFB set about placing 40m shares with clients at 282p, a significant discount to Tuesday's closing price.
Whitbread was also out of favour, sliding 20p to 508p, unsettled by the gloomy outlook for the pub market. The latest data from market research firm AGB Taylor Sofres indicates that all is not well in the industry, with the growth in pub bar snacks all but evaporating.
Great Portland Estates once again moved higher (up 4p to 237.5p) on a reasonable volume. Market gossips believe the property group, which stands at a significant discount to net asset value, is vulnerable to a takeover.
