MARKET REPORT: Investment belief bosses should go, says hedge fund

There could be a shake-up in the world of trusts after hedge fund Saba Capital Management called for managers to be axed in seven of the firms in which it invests.

In a letter to shareholders, Saba, founded by former Deutsche Bank banker Boaz Weinstein, urged them to vote out bosses after poor returns.

The investment trusts called out are: Baillie Gifford US Growth, CQS Natural Resources Growth & Income, Edinburgh Worldwide Investment, European Smaller Companies, Henderson Opportunities, Herald Investment and Keystone Positive Change Investment.

Saba is the largest investor in all of them, with stakes of between 19 per cent and 29 per cent, and is requisitioning general meetings for each trust, which it says should be scheduled for early February at the latest.

The London benchmarks were higher ahead of interest rate decisions from the US Federal Reserve and the Bank of England The FTSE 100 closed ahead 0.05 per cent, or 3.91 points, at 8199.11, while the FTSE 250 ended up 0.29 per cent, or 59.13 points, at 20,601.99.

Melrose was among the blue-chip risers, gaining 2.9 per cent, or 15.6p, to 553.6p, after Prime Minister Keir Starmer restated his pledge to increase defence spending.

Shake-up: Saba Capital Management urged shareholders to vote out the current bosses after underwhelming, and in some cases disastrous, returns

British Airways and Iberia owner IAG rose again, adding 1.9 per cent, or 5.5p, to 302.8p, after analysts at Jefferies hiked their price target for the airlines group to 350p from 270p. 

And Kingfisher edged up 0.5 per cent, or 1.2p, to 253.9p as the DIY retailer announced the sale of its Brico Depot business in Romania for £58million.

Unilever lost 1 per cent, or 44p, to 4608p after the consumer products giant said it has received a binding offer for its Unox and Zwan meat and soup brands from Zwanenberg Food Group.

And National Grid shed 1.1 per cent, or 10.4p, to 926.2p as the energy distributor released a plan detailing investments of up to £35billion over five years from April 2026.

Transact platform owner IntegraFin was among the big FTSE 250 fallers, dropping 12.7 per cent, or 49.5p, to 340.5p, as caution about rising administrative costs next year offset full-year results which showed a 17 per cent improvement in funds under direction to £64.1billion.

On AIM, Active Energy surged 218.2 per cent, or 0.12p, higher to 0.18p as trading resumed following a temporary suspension.

Hardide jumped 29 per cent, or 1.38p, to 6.13p as the surface coating technology provider signed a ten-year supply deal for the coating of cargo door components with a major customer. 

And Windar Photonics gained 10.9 per cent, or 5.5p, at 56p as the technology firm said it has secured a £2million order.

Digitalbox held steady at 4.85p as the owner of The Daily Mash website acquired the online assets of Walford News, which writes about TV soap EastEnders. 

But Zotefoams fell 5.2 per cent, or 17p, to 308p as the packaging specialist said it is halting investment in a new product, after the firm failed to secure a partner for the project.

Stock Watch – Artisanal Spirits

Investors raised a dram to Artisanal Spirits after the whisky specialist said it was on track to meet its full-year 2024 earnings forecast of £1million, a swing from a loss last year.

The AIM-listed firm reported a 5 per cent rise in members to 42,000, with strong UK growth. 

It expects further profitability in 2025 and 2026, driven by cash flow improvements and efficiency measures and is investing £500,000 to take full control of its US business from January. 

It rose 2.7 per cent, or 1p, to 38.5p.