Trump Rescues Rightmove

The UK’s largest property portal was far from Donald J Trump’s mind when the US President gave the order for the attack on Iran on Friday 27^th February. Yet his bombs were a critical element in an unlikely series of events that managed to stave off Rightmove’s relegation from the FTSE100 to the FTSE250 – sending easyJet down instead.

John Svanstrom, the under-pressure Rightmove CEO, had some big calls to announce of his own that day. He knew that the series of results he was presenting to the City, for the previous financial year 2025, contained nothing that was going to dramatically change investor perception. Revenue increase at +9% was in line with analyst expectations, as was operating profit at +12%.

FTSE Russell, the arm of the Stock Exchange that gives warnings about which stocks are to be relegated from the FTSE100 and replaced by promoted companies from the FTSE250, had already predicted three days earlier that Rightmove was on its way out. If nothing dramatic changed then, within a week, Rightmove would become a lower league outfit – as unthinkable last summer, as its share price soared at twice its current level, as Europa Cup winners Tottenham Hotspur FC being relegated from the Premier League in 2026.

Svanstrom had one shot to try and save Rightmove – and himself – from the ignominy of a FTSE250 downgrade.

A feature of a monopolistic entity which has pricing power over a captive industry is that it has buckets of spare cash that it can call upon relatively quickly. That Friday, Svanstrom announced to the City that – alongside going after an additional £120 per branch per month price increase to estate agents this year and grabbing a millions more in mortgage revenues that otherwise would have gone to his customers – he would buy back £90m of shares. This would start urgently, the following Monday, and conclude quickly by July. He would also increase shareholder dividend payouts to 10.64p, comfortably beating consensus estimates of 10.53p.

Unsurprisingly, the City loved it – a 4.3% bounce occurred, disconnected from anything else in the numbers, which had already been priced into Thursday’s market cap of around £3.17Bn. Buying back shares means there are fewer available. Increasing dividends makes them more popular. It’s hard to see either of these as anything other than a colossal bribe for investors to look favourably on the stock. On that bald metric Svanstrom’s actions succeeded. But on its own it wasn’t enough. Rightmove was still going out of the FTSE100 – but it had given itself a puncher’s chance.

The day before, in a Mayfair boardroom located a leisurely 15 minutes’ walk from Rightmove’s swanky Soho Square offices in London, a crisis was brewing. Hikma Pharmaceuticals, a company that first entered the FTSE100 three Quarters before Rightmove in March 2015, creates affordable, generic versions of existing medicines for hospitals and pharmacies worldwide. It hadn’t been in the FTSE Russell’s calculation as potentially dropping out of the FTSE100 earlier that week because it’s market capitalisation put it way ahead of Rightmove. But Hikma’s Board knew something that the market did not – and, on that Thursday in February, they told the world that their profits were going to be -17% lower than was expected, due to the underperformance of one of their key products.

From nowhere, Hikma’s stock plummeted to a position lower than Rightmove’s. Svanstrom’s shot pushed his stock up at the precise moment that Hikma’s was collapsing. But this still wasn’t enough – at close of business on Friday, Rightmove was still going down with Hikma. He needed something else – something big that would collapse another stock’s price.

And he only had two days for it to happen.

Donald Trump watched his planes destroy Ayatollah Khamenei’s compound in Iran from his golden palace in Mar-a-Lago, Florida. Quickly – and predictably – Iran retaliated by bombing as much of its energy-rich neighbours’ infrastructure as it could reach, hitting Dubai, Saudi Arabia, Kuwait, Bahrain and Qatar amongst others.

Its Revolutionary Guard said that Iran would blow up any ship that made its way through the Strait of Hormuz, the narrow waterway where 20% of the world’s oil travels. Prices per barrel jumped by 8% on the following Monday then by another 5% on Tuesday. By the end of the week they were up over 25%, a bigger increase than the Russian invasion of Ukraine elicited and on some measures (+36% on the West Texas Intermediate oil benchmark) the biggest ever.

easyJet’s cheerful orange brand has had something of a yoyo relationship with the FTSE100, twice dropping out of the index in 2019 and 2022 following its first appearance in 2013. FTSE Russell’s prediction on Tuesday 24^th Feb suggested that it was going to be relegated once more, alongside Rightmove. With Hikma’s collapse – and Rightmove’s buyback bounce stalling at 4.3% - easyJet’s non-exec lead shareholder, Stelios Haji-Ioannou, would have gone to bed on Friday 27^th thinking that his firm had avoided the dreaded drop.

But airlines are incredibly sensitive to oil prices. Jet fuel is their single biggest cost. A 25%+ increase in oil shatters profits and destroys confidence. A massive selloff by investors in easyJet and others occurred on Monday and Tuesday – precisely the two days that Johan Svanstrom needed to see another company fall below his in the FTSE 100 valuation index.

As with so much, actions that seem entirely unrelated came together for an outcome that seemed ludicrously unlikely just days before. It’s difficult to look at the graph above without concluding that Johan Svanstrom is a very lucky CEO indeed this weekend.

Of course, this will all be reviewed again by the FTSE Russell in three months and there may be no such coming together of events to save him then. But, by using millions of his customers’ cash to shore up his position this week, he’s given himself something to work with.

Trump’s bombs have changed much this week for many, many people, almost all of it for the worse. In one corner of London, however, someone might have more mixed feelings about the US President's actions on their third anniversary at the helm of Rightmove, as they celebrate with some rather expensive champagne.