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MARKET COMMENT
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Good news -- profit warnings are on the decrease. So far this year, sizeable share price tumbles are running at half the rate seen during 2002. Investors should take note. To recap, 2002 was a vintage year for profit warnings. On no less than 71 occasions did a FTSE 350 share lose 20%-plus of its value in a single session. On average, punters witnessed a big name profit alert every 3 to 4 trading days. Thankfully, profit warnings have reduced in number for 2003. Year to date, the FTSE 350 has seen just 15 shares (2002 equivalent: 34) slump 20% or more in a day, or one every two weeks. In fact, warnings from the FTSE 350 have dried up dramatically of late. Since April, only bookmakers Stanley Leisure (LSE: SLY) and estate agents Countrywide Assured (LSE: CWA) have experienced one-day share price horrors. Sadly, the market's reaction to bad news remains the same. Last year, those 71 top decliners recorded an average profit warning crash of 36.3%. This year, gloomy updates from the likes of Corus (LSE: CS.), Britannic (LSE: BRT) and Invensys (LSE: ISYS) have helped generate an average 33.4% slump. Still, fewer share price shockers provide hope to investors. Either less bad news is emerging, or the market has already been expecting many unpleasant 'surprises'. Whatever, there now seems scope for the market to move higher on any positive corporate updates. So, the summer's half-year reporting season has become crucial. If the lower rate of profit warnings can continue, the end of the bear market could be near.