March 3, 2020 / 11:31 AM / a month ago

TUI, KingFisher among possible dropouts in FTSE reshuffle

LONDON (Reuters) - European holiday company TUI and British home improvement group Kingfisher (KGF.L) are among companies likely to exit the FTSE 100 in the blue-chip index’s latest reshuffle, according to Reuters calculations based on Monday’s closing prices.

FILE PHOTO: A TUI fly Belgium Boeing 737-700 airplane takes off from the airport in Palma de Mallorca, Spain, July 29, 2018. Picture taken July 29, 2018. REUTERS/Paul Hanna

NMC Health (NMC.L) will be expelled from the index after losing about two thirds of its market value after U.S. based short-seller Muddy Waters questioned the UAE-based hospital operator’s financial statements.

While TUI benefited from the failure of rival travel company Thomas Cook, it has been hit hard by the impact of the Boeing 737 MAX grounding and, as most stocks in the travel and leisure sector, by the coronavirus epidemic.

TUI, which has lost more than a third of its value since the beginning of the year, slipped below the threshold required by FTSE Russell, London Stock Exchange-owned index provider.

FTSE Russell, which will announce its quarterly shuffle of the FTSE 100 index on Wednesday, requires companies to be at least 110th to be part of the blue-chip index.

A security will also be promoted if it rises above 90th.

The virus could be “the final blow” that pushes TUI out of the FTSE 100, said Russ Mould, investment director at AJ Bell.

An exit of Kingfisher would mark another blow for the UK retail sector after M&S, an iconic name of the British high street, was booted out from the FTSE 100 after being a constituent of the index since its inception in 1984.

Kingfisher, which has undergone a organisational shake-up under new boss Carrefour veteran Thierry Garnier, has a current market capitalisation of 3.9 billion pounds but could be knocked out by stocks rising to the top 90 largest groups.

Among those are utilities group Pennon (PNN.L), gambling company GVC Holdings (GVC.L), asset manager Intermediate Capital Group (ICP.L) and mining group Fresnillo (FRES.L).

WM Morrison Supermarkets (MRW.L), which had been at risk of losing the prestigious FTSE 100 tag, is expected to keep its blue chip status with its 99th position.

Reporting by Julien Ponthus and Thyagaraju Adinarayan in London; editing by Philippa Fletcher

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