Housebuilder Persimmon and lender Alliance & Leicester look set to lose their place in the prestigious FTSE 100 Index at the latest quarterly reshuffle.
Both firms have seen their share price slide in recent months as they suffer from the dual impact of the housing market slow-down and problems in the mortgage market. The pair are likely to be replaced by foreign miner Ferrexpo and engineering and technology group Invensys.
The promotion of Ferrexpo would continue the domination of the FTSE 100 by mining stocks, which have seen their share price surge in recent months on the back of soaring commodity prices.
If Ferrexpo is promoted to the blue chip index, the mining sector would account for 10 per cent of FTSE 100 companies.
Persimmon, which owns Charles Church, has seen the value of its shares more than halve during the past year, falling from more than 900p to just 447.25p on Friday, giving it a market capitalisation of £1.39 billion.
The slide in Alliance & Leicester’s share price has been even more dramatic, closing at 377.25p on Friday, down from a 12 month high of £11.61, giving it a market capitalisation of £1.68 billion.