St James’s Place set to plummet out of FTSE 100

St James’s Place is expected to fall out of the FTSE 100 after ten years in London’s main index.

The wealth manager, along with Ocado, is expected to be replaced in the FTSE 100 by house builder Vistry and cybersecurity firm Darktrace. However, the latter would only hold the position temporarily due to its planned takeover by US private equity business Thoma Bravo.

St James’s Place is set to be relegated after its market value plunged – it’s now the 135th biggest public company in the UK, squarely outside the top 100. Its share price has fallen by 26.5 per cent throughout 2024.

The share price of St James’s Place has slumped over 70 per cent since its peak at the end of 2021.

“The turbulence was prompted by concerns about its business model following the introduction of the new Consumer Duty last summer which imposed a legal requirement to treat customers fairly,” explained Susannah Streeter, head of money and markets at Hargreaves Lansdown.

“Confidence was dented after the company slashed its dividend and announced it had set aside £426m for potential client refunds.”

In contrast, Vistry will move up to the main index due to a 37 per cent surge in share price this year, capitalising on demand for new homes and an expected cut in interest rates.

“Vistry’s aiming to build 18,000 new homes by the end of the year, an increase on last years’ total,” added Streeter.

Meanwhile, Hargreaves Lansdown is set to return to the FTSE 100 after six months in the 250, after its stock price shot up on the back of private equity bids for the company.

The DIY platform business, now the 78th largest company in the UK, could replace Flutter Entertainment, which has opted for a listing in New York.

FTSE Russell’s rebalance will be conducted using data at market close on 4 June, two weeks from when this data was taken last week. The actual rebalance will take place at market close on 5 June.

The FTSE 250 will also see a rebalancing next week, with four companies expected to drop from the index.

These include investment trusts Next Energy Solar Fund Ltd and Octopus Renewables Infrastructure Trust, along with National Express owner Mobico.

Finally, Ukrainian iron ore miner Ferrexpo is set to be cut after a staggering drop to become the 433rd biggest company in the UK, worth only £284.1m.

“Although it appears to have overcome many of its production operational issues, reporting a rise in production and sales for its Ukrainian subsidiary, it’s now been mired in legal challenges, which have affected sentiment, with shares down by more than 51 per cent since the start of the year,” Streeter said.

Brunner Investment Trust, fintech consultancy Alpha Group, XPS Pensions Group, and asset manager Liontrust will replace them.