SMALL CAP MOVERS: Markets ‘ping-ponged’ by central bank action

This week we saw cybersecurity small-cap Brandshield announce its delisting from the London Stock Exchange.

Hardly a shocker, given that the rate of AIM delistings shows no sign of slowing down as the fourth quarter rears its head.

The wrinkle to Brandshield’s move, though, was the concurrent £2.68million share subscription to a handful of investors, one of which was former Tesco boss Sir Terence Leahy no less.

Governor of the Bank of England Andrew Bailey 

Leahy, who has been invested in Brandshield for at least 12 months, stumped up £403,000 in the subscription. Evidently, he has every trust in the management shoring the company’s finances up in the private sphere.

‘The directors believe that the delisting will assist in improving margins further and allow the executive to focus on operational excellence without the additional legal and regulatory burdens imposed through our current listed status,’ so went Brandshield’s mission statement.

There was also a £2.2million open offer at 5.68p a pop, not that retail investors are likely to bite. Shares fell 28 per cent to 2.88p pursuant to the delisting news.

The markets got kicked around left right and centre this week, ping-ponged by Wednesday’s interest rate call from the Federal Reserve them the Bank of England’s call on Thursday.

Both central banks put a moratorium on hikes (to the surprise of some when it came to the BoE).

Yet both announcements could also be summed up at hawkish pauses, in that neither went as far as taking future hikes off the table completely.

The AIM All-Share Index had conceded nearly a percentage point until the Fed pause lent buoyancy to the market, only to get tossed down to weekly lows on Thursday.

All in all, the junior market closed the week 0.8 per cent lower at 739.65.

The FTSE 100 blue-chip index was similarly volatile, though fared better in the end by closing flat at 7,717.

Corcel generated a lot of interest this week. Extraction srl, an investment group majority owned by Corcel chairman Antoine Karam, gifted the Angola-focused mining group a £10million convertible loan at an 80 per cent premium to the market.

Shares have been on a roll since late last week, and are currently 75 per cent higher since last Wednesday’s closing price.

Orcadian Energy led the charge in the energy sector, with shares pumping a stellar 300 per cent after the company announced a preliminary agreement with an unnamed potential operator of its key North Sea asset.

The deal, if finalised, would focus on developing the Pilot field, one of the largest untapped areas in the Central North Sea.

Chariot was also a top mover in the energy sector. The Africa-focused transitional energy group added 32 per cent following its interim earnings call on Tuesday.

Stakeholders were taken with Chariot’s progress at the Anchois gas development project in Morocco, where partnering negotiations are in the final stages, according to management.

Other bullish stocks in the heavy industries included Arkle Resources, which jumped 38.5 per cent, ECR Minerals, which jumped 28 per cent after raising £580,000 in a direct subscription, and Premier African Minerals, which added 24 per cent after an update to its Zulu Lithium and Tantalum Project.

Switching gears, metaphorically and literally, bus transportation firm Rotala rumbled to the top of the movers list after announcing it has received a bid approach from a management-led team which would value the company at around £19.4 million.

Rotala shares jumped 40 per cent to 59p as a result.

In the biotechnology space, Scancell Holdings had a bumper week after adding over 63 per cent to its share price.

Scancell got the attention of City brokers, particularly Stifel, after posting expectation-busting initial results from the phase II SCOPE trial in advanced melanoma.

Discussing the vaccine trial results, which were released on Tuesday, Stifel analysts backed the AIM-listed biopharmaceutical company with a buy rating.

Lastly, restaurant operator Comptoir Group’s 20 per cent share price fall on Friday underscored the headwinds facing the hospitality sector right now.

‘Trading continues to be impacted by significant events outside of our direct control,’ non-executive chair Beatrice Lafon said in the group’s interims, ‘such as the ongoing public transport industrial action which now enters a second year… We have also had a relatively poor summer in terms of terrace weather.’

Lafon also pointed to macroeconomic pressures, including high inflation and the ending of government support with business rates and value-added tax.

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