Market report: Provident Financial tumbles as City fears fresh profit alert

Investors slammed the door on Provident Financial again today on fears of another profit warning from the troubled doorstep lender.

Shares in the FTSE 100 company plummeted 18% a fortnight ago when it warned adjusted profits from its consumer credit arm would be almost half the £115 million it made last year. It blamed the drop on cutting back its loan collectors from 3800 to 2500.

Liberum said today that another profit warning for the home credit division is likely. “Guidance remains too optimistic,” analyst Portia Patel said as she trimmed her target price from 2770p to 2000p.

Investors who listened to her advice in May as she downgraded Provident from Hold to Sell would have avoided last month’s profit warning.

Today they were concerned she might be on the money again as the shares slipped 89p, or 3.7%, to 2344p.

Provident was the biggest blue-chip faller on a lacklustre day for the market as the FTSE 100 climbed 39.87 points, 0.55%, to 7352.59.

Miners were boosted as China’s manufacturing returned to growth last month, according to the Caixin PMI survey. Glencore, up 7.2p at 294.4p, and Anglo American, 22.5p better off at 1046.5p, topped the index.

Product-testing firm Intertek dipped 26p to 4191p after both Goldman Sachs and Berenberg downgraded it to Hold.

Away from the top flight, Electrocomponents charged up 17p, or 3%, to 594p after a strong trading update for the electronic parts distributor.

Plus500 surged 38.5p, or 7%, to 584p, its highest since the FCA unveiled its clampdown on contract-for-difference providers in December.

Today, the business, which sponsors Spanish football club Atletico Madrid, said trading had been strong over the past month and predicted revenues and profits this year would be significantly ahead of market expectations.

Small-cap oil favourite Sound Energy plunged 17.75p, or 23%, to 59.25p after revealing its gas discovery in Italy was not commercial.

Frank Scolaro, the former business partner of controversial resources magnate Frank Timis, quit the board of Obtala, the AIM-listed African agricultural business he founded. Obtala dipped 0.4p to 17.2p.