City takes a bet on IG profit warning

THE value of poker-playing Stuart Wheeler's 32% stake in his spread-betting firm,

The shares closed unchanged at 298 1/2p, but dealers were last night talking them down by as much as 100p if a profits warning hits dealers' screens this morning.

Tory party donor Wheeler resigned as chief executive earlier this year and was replaced by Nat Le Roux. Wheeler has remained as chairman. The stock has already more than halved in value since November following a drastic decline in trading.

Competition in the cut-throat spread-betting field is fierce. Le Roux has admitted that the heady days of endless growth are over for the time being. Many clients who lost their shirts when the internet bubble burst have yet to return, some lost for good. The bear market has kept business to a minimum and IG Group has suffered more than most.

IG's price perked up on relief that Chancellor Gordon Brown's Budget tax measures left the sector unscathed, but has since drifted on lack of support. IG's sports division will be hoping for a lucrative World Cup, but its financial side will probably suffer as a result.

Continuing sabre-rattling between Pakistan and India over Kashmir and fears of a terrorist attack on the US on Memorial Day kept investors away. With Wall Street closed, business was slow and turnover a disappointing 1.8bn shares. The FTSE 100 lost an early 18.8-point gain to finish 32.8 off at 5136.3 after Pakistan's President Musharraf warned that 'war could break out'. Sterling strengthened as the euro slipped to 63.1p. In dollar terms, the pound held firm at $1.4570.

'Take profits' advice by Dresdner Kleinwort Wasserstein left BT Group3 1/4p easier at 283p. Sir Martin Sorrell's giant advertising agency WPP lost 17 1/2p to 722p after client Unilever (1 1/2p dearer at 634p) confirmed a four-year £320m advertising deal with ITV.

Buying ahead of an imminent trading statement lifted logistics group Hays 6p to 164 1/2p.

Supermarket J Sainsbury was off the menu ahead of Wednesday's results, closing 5 1/4p down at 370 3/4p. Hilary Cook, at Barclays Private Clients, says 'sell'. She believes Sainsbury will show a good profits recovery from last year's depressed levels, but the question is where does it go from here?

Tracker funds moved smoothly through the gears at GKN, lifting the price 10 1/2p to 350p on confirmation that the car parts and helicopter group will replace Innogy - taken over by Germany's RWE - in the Footsie on Wednesday.

Expectations that its bid for rival motor dealer Quicks will go unconditional on Wednesday helped CD Bramall accelerate 19p to 365 1/2p.

Pet food distributor Armitage Brothers was as sick as a parrot at 149p, down 9 1/2p, after warning that pre-tax profits for the year to June will disappoint. Aim-listed fund manager Savoy Asset Management, where former Chancellor Ken Clarke is chairman, dropped 20p to a low of 100p after warning that profits for the year to March 2002 would be below market expectations and there would be no final dividend. TransEda collapsed 5p to 9 1/2p on a profits warning. New contracts in the third quarter took longer to nail down and that hurt turnover.

Computer services group Patsystems firmed 1 1/4p to 10p, after chief executive David Leighton purchased 500,000 shares at 9p. Dealers expect shares of oil services firm John Wood to be priced near the middle of the 175p-210p price range. The offer is believed to be more than three times subscribed.