Markets News

UPDATE 1-Trading platform CMC Markets shares rise as it backs upbeat outlook

(Adds details from statement, analyst comment, shares)

Sept 3 (Reuters) - CMC Markets on Thursday reiterated that it expects 2021 profit to top the upper end of market consensus, although the online trading platform warned of higher costs as it brought on more clients during the COVID-19 pandemic.

Shares of the company, whose online trading platforms allow individuals to make leveraged bets on financial markets, rose 8.3% to 338 pence in early trading.

“Client income retention has remained particularly strong and well in excess of the guidance of above 80%,” the British company said in a statement, adding that trading performance in July and August was strong.

CMC and rivals Plus500 and IG Group, have benefited from the coronavirus-induced market volatility. Markets had tumbled earlier in the year, but have recovered in recent weeks.

Analysts at RBC said they expect the incremental cost as signalled by CMC to be much lower than the increase in income.

CMC said it would continue to focus on its investment in technology which was paying off in attracting and retaining clients.

Reporting by Aniruddha Ghosh and Pushkala Aripaka in Bengaluru; Editing by Amy Caren Daniel