CMC Markets share price drops as spreadbetter reports it has grown customers despite taking a knock over FCA rules

Spreadbetting firm CMC Markets today reported that it has grown customer numbers in the year to 1 April, despite a planned shake-up of the rules around its products which hit the company hard at the end of 2016.

Shares in CMC plunged by more than a third in December when it was revealed the City watchdog wants to tighten the rules around contract for difference (CFD) products. The stock inched up in early trading today, by 0.5 per cent, but has since dropped by 2.5 per cent.

In the aftermath of the regulator’s announcement, CMC reportedly considered moving its headquarters from London to Germany. The German financial watchdog Bafin also set out new CFD rules late last year, but they were considered to be less extreme than the UK’s.

However, today CMC said active CFD/spreadbet client numbers have continued to increase, in a pre-close trading update.

The Financial Conduct Authority’s (FCA) consultation on CFD controls closed on 7 March and CMC said it “made an extensive and thorough submission”.

The firm, which listed in February last year, added it looks forward to working with the FCA and receiving the outcome of the consultation during the summer. CMC has also responded to the Bafin consultation which closed in January.

The group also said revenue was “modestly higher” in the second half of the last financial year, while full year net operating income will be below net operating income in 2016.