Sharewatch: BSkyB Recovers On Positive Sentiment

BSkyB was seen in focus again yesterday, up 2.48% despite speculation that its chief executive, Tony Ball, could leave the satellite broadcaster as part of a wider management shake-up implemented by Rupert Murdoch (see Ball Could Depart BSkyB After Management Restructure).

It is understood Ball is to be replaced by Murdoch’s son James, who has reportedly been groomed for the role over some time. This created uncertainty in the city yesterday but, on reflection it was felt that an immediate change is unlikely and may not be announced until November when BSkyB holds its annual meeting.

Elsewhere, Reuters rose 3.21% following an upgrade from brokerage house, Charles Stanley, which rated the stock ‘buy’ citing the improved profitability of the group’s financial service customers.

Broader market sentiment was poor yesterday, despite bullish comments from the Fed, which promised to keep the cost of borrowing low for a ‘considerable period’. However, weakening Labour market indicators weighed heavily on the market.

Leading investors have also claimed a sustained rally is unworkable as stocks remain structurally problematic and there remains a great deal of overvaluation in stocks in the media sector.

The closing prices of media company shares on Wednesday were: