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Directors reluctant to add exposure to their companies at current prices, says Deutsche

Last updated: 04:00 16 Nov 2013 EST, First published: 05:00 16 Nov 2013 EST

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Deutsche Bank’s fortnightly survey of directors’ dealings reveals trading has been subdued across Europe – mainly because the third quarter reporting season has curtailed activity.

However, wherever it has occurred, it has ostensibly seen selling.

According to Deutsche, which looks at 600 companies across Europe, there was a cumulative 70mln euros of director sales over the 50-day period analysed compared with 21.4mln euros stock acquisitions, which represents a year-low.

In terms of sectors, the selling activity has been most pronounced in tech and industrials. 

“Directors are reluctant to add exposure to their companies at current price levels, or put differently, are happy to reduce positions, as the latest data points – buying volumes 50% below their long-term average level and a clear dominance of selling – underline,” Deutsche said in its latest note.

The biggest sale of the week here in the UK was by Scott Forbes, chairman of the property website Rightmove (LON:RMV), who netted almost £3.6mln after exercising his share options.

One of the biggest buy transactions was an order of magnitude smaller. It was carried out by Flemming Ornskov, chief executive of Shire (LON:SHP), who spent £620,000 bulking up his position in the FTSE 100 listed speciality pharma group. 

Lower down the sector’s food-chain Medgenics (LON:MEDG) chairman Sol Barer has waded into the market to acquire £94,000-worth of stock.

For the uninitiated, Dr Barer was a major force behind the transformation of Celegene, which grew from an outfit employing 30 researchers, to a business that’s now worth more than US$60bn.

Medgenics has created a device called the biopump, which allows the slow release of medicine by inserting a small sliver of treated tissue under a patient’s skin.

The purchase follows a very confident first presentation by the firm’s new chief executive, Michael Cola, who incidentally was formerly with Shire.

Once again, there has been stock acquisitions by the directors of Shanta (LON:SHG), which suggests the board is fairly confident about the gold miner’s prospects.

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