NEARLY £95 million was wiped off the market value of Aggreko yesterday as investors digested a note from Peel Hunt downgrading its rating for the temporary power generator amid concerns over the global economy.

Shares in Aggreko fell by nearly five per cent in light of the note, which in its title warned that the challenges facing the Glasgow firm “continue to be significant”.

The broker underlined the threat posed by the “fragile global macro-economic backdrop” as it downgraded shares in Aggreko from hold to reduce, setting a 700p target price for the stock.

READ MORE: Aggreko on track to match 2017 profitability figure

The intervention by Peel Hunt comes after Aggreko’s third-quarter trading update in November, when the firm said profits for 2018 were on track to match the previous year’s. It booked a pre-tax profit of £195m for the 12 months to December 2017.

Aggreko said then that its performance was being driven by its dominant rental solutions arm, which had benefited from the recovery in the North American oil and gas sector and increased activity in the Australian mining industry.

However, it reported falling revenue in its utility division, reflecting “lower rates and volume in Argentina and the continuing effect of off-hires in Zimbabwe, Bangladesh and Japan”.

READ MORE: Aggreko boss told to go at AGM

Peel Hunt said: “Management is performing well across tricky markets. The Q3 update provided some reassurance that Aggreko remains on track, but the ever-shifting challenges remain significant. We are wary that the fragile global macro-economic backdrop is likely to lead to customer hesitancy and greater off-hire risk.”

Shares in Aggreko closed down 37p, or 4.95 per cent, at 711p.