Support services company Interserve continued its nail-biting stock market ride yesterday, as shares ended the day up more than five per cent after plummeting to new lows earlier in the week.
The rally appeared to be a sign of investors adjusting to Interserve’s vehement denial over the weekend that crucial talks with banks had stumbled.
The company, which holds a number of government contracts including one to manage a defence training base on Salisbury Plain, admitted in an October profit warning that it was close to breaching banking covenants.
As fellow outsourcer Carillion crashed at the beginning of this year, hedge funds piled in to short Interserve, upping their bets against the company and causing the share price to crash.
Meanwhile Deloitte has been brought in by the government to watch over Interserve and flag any similar crisis before it hits.