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[Stock Lobster]

Re BP: Very much so, imo. Downgrade to junk means investment grade funds MUST divest....

never mind the pending dividend cut, which they are postponing announcing. Even though they will call it a 'deferred' dividend, I still would be concerned that quite a few funds who ONLY invest in dividend stocks, would see the writing on the wall, and began divesting of the stock.

The news yesterday, from the UK Telegraph, that large funds have already begun divesting, confirms what we see on the tape

BP oil spill: Largest shareholders cut stake as price falls

BP's largest shareholders have cut their holdings in the troubled oil giant – with five of the group's top 10 shareholders selling shares in recent weeks.


Analysis by The Daily Telegraph of data compiled by Citywatch shows that major UK institutions including Legal & General, M&G, Scottish Widows, Threadneedle and Axa have all trimmed their holdings since the Deepwater Horizon rig sank with the loss of 11 lives in April.

A number of so-called "FTSE tracker funds" will have been forced to sell as BP's share price fell – reducing its relative size in the FTSE 100.
http://www.telegraph.co.uk/finance/newsbysector/energy/oilandgas/7825131/BP-oil-spill-Largest-shareholders-cut-stake-as-price-falls.html