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26 Oct 2015
Aberdeen Asset Management (ADN) shares are top of the UK Index this morning, benefiting from a prime example of ‘buy the rumour…’ even if said rumour has already been swiftly denied. Weekend press speculation suggested ‘ADN’ had been sounding out buyers after turbulent period for markets linked to global growth expectations and monetary policy which saw profits and assets slump and the share price sink to 3yr lows of 290p. While the shares were already rebounding with the wider market on easy money/stimulus hopes in October, getting back to 330-350p, the spec has seen the shares break out and gap up to levels last seen in late July.
Denial from founder and CEO Martin Gilbert is not, however, seeing the other half of the trading adage (‘…sell of the fact’) put pressure on the shares just yet. Short sellers have likely been squeezed out on the recent 20% rebound and don’t fancy another go, recent bottom pickers are holding on hoping their proves to be substance in the speculation while momentum traders are jumping on board in the hope of a quick return to 400p. Will further denial scupper takeover hopes or simply lead to claims of the ‘laddie doth protest too much’.
Mike van Dulken, Head of Research
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