But Jupiter Fund Management stressed it had shown resilience in the face of declines for the FTSE 100, which fell 14 per cent in the three months to September 30 during its worst quarter for nine years, as well as the FTSE All World Index which was down 16 per cent.
Jupiter also managed to generate net inflows of £295million in the three months to 30 September as it continued to attract new money.
Chief executive Edward Bonham Carter said Jupiter had made progress ‘despite one of the worst quarters for equity markets in the last decade and reduced risk appetite from retail investors, particularly in Europe’.
‘Our balance sheet position also continues to strengthen, allowing us to announce a substantial debt repayment,’ he said.
Jupiter’s third quarter figures follow a report from fellow asset manager Hargreaves Lansdown yesterday which revealed net new business inflows of assets were up 24 per cent year on year at £680million in the third quarter.
However, stock market falls led to a 9 per cent fall in the total value of Hargreaves’ assets under administration to £22.3billion pounds.
Shares in Jupiter rose 1.45p to 207.25p while Hargreaves’ were up 5.25p at 505.25p in late-morning trading today.
Jupiter said of the market outlook: ‘Volatile markets continue to impact on investor confidence and flows across the asset management sector, particularly in Europe.
‘Despite this, we continue to believe in the long-term growth prospects for the savings market and our ability to access these opportunities on behalf of investors and shareholders.’
View from the City
Jupiter has reported better flows that expected and maintained its track record of consistent positive inflows, said Stuart Duncan of broker Peel Hunt, which has a buy recommendation on the stock.
‘Solid flows, high operating margins and little reliance on performance fees make an attractive combination.’
However, Peel Hunt announced today that in light of deteriorating markets it was downgrading its forecasts for asset managers by an average 11 per cent.
‘Sentiment remains fragile, given macroeconomic concerns, and there is still downside risk to forecasts given continuing volatility, although the danger is that some of the longer-term stock attractions are overlooked,’ said Mr Duncan.
But he added: ‘Stocks that have resilient new business flows, high operating margins and strong or improving balance sheets remain well positioned. Our favoured stocks include Aberdeen, Ashmore and Jupiter, which meet these key criteria.’
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Category: Business/ Economy
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