LONDON (Reuters) - A sharp fall for advertiser WPP was offset on the British market on Wednesday by gains in mining shares, which extended a strong run, and a buoyant health sector.
The FTSE 100 .FTSE ended flat at 7,382.65 points.
Shares in WPP (WPP.L), the world’s biggest advertising group , sank 10.9 percent, its worst day in 19 years, after it cut its outlook for the full year.
Consumer goods clients were trimming spending, it said.
WPP’s shares were already down around 12 percent this year heading into these results as it had cut its 2017 sales forecasts back in March.
“In the near term ... the poor trading momentum is likely to act as a continued drag on the stock until there is more evidence of a pick-up in sales growth,” analysts at Patronus Partners said in a note.
The drop in WPP followed a big fall by Provident Financial (PFG.L) in the previous session, tanking 66 percent after it issued a profit warning, saw its CEO quit, suspended its dividend and disclosed a regulatory probe.
Provident’s shares fell as much as 8 percent on Wednesday in volatile trade, then recovered to end 12.1 percent higher amid a broker scramble to slash target prices and ratings on the stock.
“Downgrade risk is still present due to lack of visibility on timeline, measures to be put in place and how much further investment is required,” analysts at Barclays said in a note.
“With uncertainty over the ... investigation and the size of the potential financial impact, we lack conviction and downgrade to (equal weight) from (overweight).”
Mining stocks extended gains .FTNMX1770, up 1.5 percent and holding at a six-month high.
Mid-cap stocks < .FTMC> ended flat, led by a 5.6 percent gain in NMC Health’s (NMC.L) shares which rose after the firm reported a 34 percent rise in first-half revenue.
Reporting by Kit Rees and Danilo Masoni; editing by Jeremy Gaunt