Morgan Stanley rates the outsourcing group “equal-weight” with a target price of 650p. The broker is disappointed by the small number of work and pensions contracts the firm picked up last week, and expects Serco’s revenues from welfare-to-work programmes to drop in the second-half of the year. While the impact on overall forecasts will be minimal, the broker adds that sentiment around the company will take a more significant dent.

Seymour Pierce rates the retailer “buy” but has lowered its target price from 450p to 380p. The broker expects the firm’s quarterly trading figures out tomorrow to show a 6.5 per cent drop in general merchandising sales, due to a shorter-than-usual January sale. The broker is more bullish on food sales than the rest of the market, expecting a 0.5 per cent drop compared to a one per cent rise predicted by consensus estimates.

UBS has downgraded the credit card insurer from “buy” to “neutral” and cut its target price by more than half to 160p following last week’s news of an investigation by financial watchdog FSA. The broker is concerned that business partners might pull back from working with CPP in the noise surrounding the FSA probe. If CPP loses three partners, UBS estimates a 30 per cent downgrade to its 2014 forecasts.