Iconic luxury fashion brand Burberry (BRBY.L) is getting kicked out of the FTSE 100 (^FTSE), while insurer Hiscox (HSX.L) will be added to the UK's blue-chip index.
Hiscox's promotion has made room for computer maker Raspberry Pi (RPI.L) to join the FTSE 250 (^FTMC) in the reshuffle, which was confirmed on Wednesday and will take effect from the start of trading on Monday 23 September.
The indices are reshuffled by provider FTSE Russell every quarter according to market cap data from the end of the previous month.
Burberry shares have plummeted 55% year-to-date, resulting a market capitalisation of £2.3bn ($3bn). This marks an end to its 15 years on the FTSE 100, after a challenging year for the brand.
Richard Hunter, head of markets at Interactive Investor, said: "A general slowdown in demand for luxury goods has weighed on the sector, especially from Chinese consumers, who have been conspicuous by their absence."
Burberry reported a 23% fall in sales in the Asia-Pacific region in its first quarter as part of the trading update that was brought forward, with chair Gerry Murphy saying that weakness the company had highlighted coming into its 2025 fiscal year had deepened. He said that Burberry expected to post an operating loss for the first half if this trend persisted.
And the bad news for investors didn't stop there, as Burberry decided to suspended dividend payments for the 2025 fiscal year.
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In addition, it was announced that Joshua Schulman had been appointed as fashion house's CEO and executive director, replacing Jonathan Akeroyd who stepped down and left the company “with immediate effect.”
Airline EasyJet (EZJ.L) was also on the list as another stock expected to exit the FTSE 100 but an uptick in its shares has helped it narrowly avoid being relegated. Shares were up 1.4% over the past five days, giving it a market value of £3.7bn, though year-to-date the stock is down nearly 5%.
EasyJet announced that it is partnering with US start-up JetZero to develop a blended-wing body aircraft for commercial flights that they claim is expected to lower fuel burn by 50%.
Meanwhile, Hiscox shares are up more than 13% year-to-date, taking its market capitalisation to £4.06bn.
The insurer reported an increase of 7.1% in profits before tax to $283.5m for the first half of 2024, in results released in August. The company also said written premiums on insurance contracts, which refers to the total amount customers have to pay for coverage, had grown 3.3% to $2.8bn.
In July, there were also reports that two foreign rivals — Japan’s Sompo Holdings and Italy’s Assicurazioni Generali — were mulling takeover bids for the Lloyd's of London insurer.
Hunter said that another contender to move into the blue-chip index had been warehouse owner Tritax Big Box (BBOX.L). Shares were down 4% year-to-date but up nearly 18% on a one-year basis, giving it a market valuation of £4.02bn.
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He said: "Tritax's latest August update noting improving conditions after the recent Bank of England interest rate cut and the conclusion of the general election."
"In turn, the company added that considerable pent-up demand is likely to increase business confidence and crystallise occupier leasing decisions, with the possibility of reducing vacancy and a continuation of rental growth," Hunter added.
Raspberry Pi joined the FTSE 250, with shares up almost 7% year-to-date, giving it a market value of £713.7m.
Raspberry Pi debuted on the London market in June, with shares soaring on its first day of trading. Its decision to list in London was considered a victory for the UK market, which has recently struggled to attract flotations from big companies and seen some move elsewhere.
Russ Mould, investment director at AJ Bell, said the move was a "big win" for Raspberry Pi, which makes smaller affordable computers aimed at helping children learn to code.
"It should help to put the stock on the radar of more investors and provides a much-needed addition to the small pool of tech stocks in major UK equity indices," he added.
Falling out of the FTSE 250 is Diversified Energy Company (DEC.L), which is down 24% year-to-date with a market capitalisation of £412.6m.
Diversified Energy runs older US onshore oil and gas wells, announcing recently that it was acquiring natural gas properties in east Texas for $68m.
The company had a challenging start to the year, announcing in March that it was cutting its dividend by two-thirds to $0.29.
In its half-year results released in August, Diversified said it was trading in line with expectations, generating a net income of $16m.
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