CMC Markets warns on profits after summer trading lull
Spread betting and online trading company benefited from market volatility earlier in the pandemic
Spread betting and online trading company CMC Markets has warned on profits after a summer lull in trading activity.
The company, which benefited from market volatility earlier in the pandemic as clients traded more, said on Thursday that this had been “subdued” in July and August resulting in less activity from both new and existing clients.
As a result, the FTSE 250 group warned that “should current market conditions prevail for the remainder of the year”, it expects net operating income for the 12 months to March 2022 to be between £250m and £280m. That is down from a figure of “in excess of £330m” that CMC pointed to in a trading update in late July.
The company recorded net operating income of almost £410m in the year to March 2021 as market volatility encouraged clients to trade more.
CMC said on Thursday: “Beyond the recent moderation in market activity, the group continues to have confidence in the long-term growth opportunities of the business.”
Last month, online investment group Hargreaves Lansdown also cautioned that the pandemic surge in trading would not last, sending its shares down 11 per cent on the day.