WPP biggest loser in the City as recession kicks in

LONDON - Shares in WPP Group have been hit after broker Citigroup warned now was not the time to buy into the marketing services giant.

The rating on Sir Martin Sorrell's empire was cut from buy to hold today (Monday) while the price target was cut from 552p to 440p with the share price falling 8p to a low of 392p, though it had regained some ground by 3:45pm to hit 394p down 2.2% or 8.75p.

The advertising giant was one of the city's biggest losers today, thought largely to be down to the influence of the brokers.

According to some reports analysts believe the seasonal nature of advertising, which saw its highest profits of the year coming in the run up to Christmas, is the cause of the fall as clients are no longer advised to invest in the firm.

Six months ago WPP's share price stood at over 486p and a year ago it stood at 615p. It has been falling steadily since early 2007, hitting 785p on March 21 that year, almost exactly two years ago today.

Last week Sir Martin predicted the current recession would be "L-shaped" or prolonged rather than the "bath shaped" analogy he famously used to describe a previous downturn.

He said he thought the first half of 2009 would be "very tough", the second half "relatively better" and that we would see a "recovery of sorts" by 2010.

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