New Directors’ Confidence Index by KTS shows Banks on top, Leisure bottom
19/12/2003
Knowledge Technology Solutions PLC, the independent provider of real-time market data services, has launched its Directors’ Confidence Index (DC Index), a new index that tracks directors of London quoted companies buying and selling shares in their employer over the last six months. Director buying or selling is one of the best measures of directors’ confidence in their own companies, and is watched closely by professional investors.
According to the new DC Index, Banks have outperformed every other sector in the six months to December 12th. A positive index shows there has been more director buying than selling in each sector, and a negative index represents more director selling than buying*.
The DC Index also records the total volumes and values of directors’ shares dealt. Across all the sectors there were 3,505 director share purchases worth more than £70 million and 804 sales valued at over £437 million during the six month period to December 12th.
The KTS research reveals that the banking sector had the highest confidence rating, scoring a total of +1.61 (£2,320,782 worth of shares purchased and £713,289 sold). Aerospace & Defence was the second strongest sector with a DC score of +1.08, followed by Engineering & Machinery (DC rating of +1.06) and Beverages (DC rating of +0.67). Over the same period, there was a rise of more than 100 points in the FTSE-All Share from 2018.3 to 2147.9.
The Directors’ Confidence Index is based on data sourced from KTS’s QuoteTerminal service that provides live UK financial news and data, such as real-time share prices, volumes and company fundamentals.
In terms of the sectors experiencing the lowest confidence among directors in the last six months, the Leisure, Entertainment & Hotels sector scored a DC rating of -67.58 (£3,632,654 worth of shares bought and £71,211,096 sold). The second weakest performer was Media & Photography (DC rating of -45.45) and Support Services (DC rating of -37.01).
In value terms, looking at the total cash amounts of shares bought by directors in their own companies, the General Retailers sector came in ahead of the others with over £8 million worth of shares purchased in 143 transactions. Second was the Media & Photography sector, which had shares valued at £7.89 million bought in 167 transactions.
The Leisure, Entertainment & Hotels sector had the highest value of shares sold by directors – more than £71 million in only 47 transactions.
Dr Marc Pinter-Krainer, Chief Executive of KTS, commented:
“Director buying and selling is closely scrutinised in the City. As such, our Directors’ Confidence Index page detailing director share transactions in each sector is very popular on our QuoteTerminal service. While there are many other variables that should and must be taken into account, our new Directors’ Confidence survey shows clearly which sectors are in and out of favour.”
KTS will publish the next Directors’ Confidence Index in six months’ time.
* The Directors’ Confidence Index is calculated by subtracting the value of the shares directors in each sector have sold from the value of the shares they have bought and dividing this figure by £1,000,000.
