Shares down at industrials after Investec downgrades 15 firms

 
Caitlin Morrison
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INVESTEC sent share prices tumbling yesterday after it downgraded several UK industrials companies yesterday, blaming the deteriorating economic environment in Europe.

The bank said that in light of recent profit warnings in the industrials sector, it had identified vulnerable companies, downgrading 15 of the most affected.

Investec said it had focused on those with “significant exposure to general industrial trends” in Europe. It stated: “The threat of a triple dip recession in Europe has loomed increasingly large in the past few weeks.”

In particular, Investec highlighted the German economy, which had weakened since the start of the summer. The bank said that this probably reflected the effect of sanctions against Russia and slowing growth in China.

One of the companies Investec singled out as performing “worst” over the past three months was industrial maintenance firm Brammer. Its price target was cut from 435p to 400p, and Investec maintained its buy recommendation. Brammer’s share price fell by almost three per cent yesterday and Vitec, which Investec noted as one of the best performers out of the 15 it downgraded, also took a hit, with share price falling by 1.36 per cent.

However, Investec claimed that despite challenging markets, it saw the UK industrials sector as being relatively well positioned for growth versus its international peers, as well as being “operationally and financially strong”.

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