MARKET REPORT: Hotel fears spook Whitbread over rival Airbnb's rise
INVESTORS checked out of Premier Inn owner Whitbread amid concerns that hotel companies face a growing threat from accommodation websites.
Whitbread fell 81p to 4247p as UBS cut its neutral rating to sell as it flagged the increasing consumer awareness of providers such as Airbnb.
The broker believes hotel groups most at risk are economy and budget ones and those with a low percentage of business-related guests.
But analyst Jarrod Castle said: "While 55 per cent of Whitbread clients travel for business and it operates in the midscale segment we don't think they'll be immune from some impact from shared accommodation."
Despite the continued strength of its Primark fashion business, Associated British Foods lost 56p to 2621p as Berenberg reduced its earnings forecasts citing the impact of low EU sugar contract prices.
Tullow Oil was 9p slicker at 706½p after Japanese trading giant Mitsubishi Corp bought a 20 per cent stake in an oilfield offshore Ivory Coast in which Tullow has a 30 per cent interest.
Buy support from JPMorgan Cazenove with a 470p target underpinned housebuilder Barratt Developments 10p to 389¼p, while auto parts engineer GKN accelerated 3p to 347¾p as dealers noted strong demand for 4x4 sport utility vehicles.
Associated British Foods dropped as Berenberg reduced its earnings forecasts citing the impact of low EU sugar contract prices
Merlin Entertainments firmed 11p to 353p in anticipation of a bullish third-quarter trading update from the Thorpe Park and Alton Towers theme parks group.
But precious metals producer Fresnillo eased 3p to 816p as it agreed to buy Newmont Mining's 44 per cent stake in their Penmont Mexican gold mining joint venture for about 278million.
Sainsbury's added 1¾p to 287p amid vague bid talk.
The FTSE 100 index closed up 7.34 points to 6806.96.
On Wall Street the Dow Jones industrial index closed 61.49 points down at 16,987.51.
