Sector movers: Aveva profit warning sinks software stocks

12th Sep 2014 13:52

A profit warning from Aveva sent the UK-listed software sector firmly into the red on Friday with the FTSE 250 losing as much as a quarter of its value.The stock was down 24.6% in afternoon trade after Aveva added to the list of problems affecting its first-half results.Currency movements and the timing of contract renewals had already been flagged, but the company also said that a sales force reorganisation and a softening of demand in some markets would also have an impact on numbers.Aveva, which designs engineering software for the plant, power and marine industries, said first-half revenues would fall to around £84m-90m, from £108.5m the previous year. Analysts had on the whole expected a result broadly similar to last year.Analysts at Investec, who placed their 'buy' rating for Aveva under review following the statement, said: "Today’s news is disappointing as we felt the strength of the business model would prevent such a surprise downgrade."Other UK stocks in the software sector, such as Coms, Bango, Gresham Computing, Sage and Phoenix IT, were also trading in negative territory on Friday.In other software news, US computer giant HP announced on Thursday night that it had acquired cloud-computing firm Eucalyptus. This is the first major deal undertaken by HP since the controversial Autonomy purchase in 2011.Top performing sectors so far todayIndustrial Metals & Mining 1,371.19 +2.15%Household Goods & Home Construction 12,198.36 +1.12%Personal Goods 24,496.86 +1.00%Financial Services 7,807.81 +0.97%Tobacco 41,455.05 +0.93%Bottom performing sectors so far todaySoftware & Computer Services 1,123.05 -3.04%Oil & Gas Producers 8,338.04 -0.35%Construction & Materials 4,050.14 -0.10%Electricity 9,489.85 -0.09%Gas, Water & Multiutilities 6,199.54 -0.07%