Market Report: Talk of Barclays tie-up raises the Standard

Could Barclays be about to pounce on the emerging markets bank Standard Chartered? According to rumours doing the rounds of dealing rooms yesterday, Barclays has offered the Khoo family of Singapore up to 1,200p a share for their 13 per cent stake in Standard. Such talk sent the group's shares 16p higher to 947.5p, while Barclays rose 7p to 551p.

Could Barclays be about to pounce on the emerging markets bank Standard Chartered? According to rumours doing the rounds of dealing rooms yesterday, Barclays has offered the Khoo family of Singapore up to 1,200p a share for their 13 per cent stake in Standard. Such talk sent the group's shares 16p higher to 947.5p, while Barclays rose 7p to 551p.

Tan Sri Khoo Teck Puat, the patriarch of the family, died last year and it has been widely rumoured that his descendants are interested in disposing of the shareholding. Most recently, JP Morgan has been reported as being interested in acquiring the stake and the bank as a whole. However, a tie-up with Barclays would certainly make a lot of sense. For the Khoo family it would mean that they could get cash for their holding while a deal for Barclays would give it the international presence it lacks.

Most analysts believethe banks would make a perfect fit. And Barclays certainly has the firepower to execute such a deal. In fact, it is believed to have tried to woo Standard Chartered on at least two occasions.

Elsewhere in the sector, Egg jumped 7.25p to 114.5p as investors agreed that the appointment of Mark Tucker as Prudential's chief executive greatly increases the possibility the insurer will dispose of its 79 per cent stake in the internet bank.

The FTSE 100 rose 12 points to 4,922.5, while the FTSE 250 recovered strongly from a slide on Wednesday to close 56 points better at 7,144.0. ARM Holdings put on 2.25p to 105.5p amid rumours ASML, the European semiconductor group, may be tempted to take a stake in the UK player. But analysts quickly dismissed this suggestion. They pointed out that ASML, which makes semiconductor manufacturing equipment, is unlikely to have a great deal of interest in ARM, which focuses on chip design.

Homeserve jumped 31p to 876p after UBS raised its price target on the stock to 1,000p and argued that the outlook at the support services group remains positive. Meanwhile, Richard Harpin, the chief executive, disclosed the purchase of £7m worth of shares at 844p. This takes his holding to more than 16 per cent.

Dealers reported heavy institutional demand for telecoms stocks. BT Group led the way, rising 6p to 206p, thanks to SG Securities, which slapped a "buy" rating on the fixed-line operator. According to SG, the Cityis overly pessimistic on the long-term loss of value at BT. Mobile phone groups were also higher ­ Vodafone added 2.5p to 143.25p, while Virgin Mobile dialled 10p higher to 223p.

Regal Petroleum slumped 25p to 435p after a bullish drilling update from the group's oil field in Greece failed to emerge. It had been hoped that the statement from Regal's Kallirachi field would show that the company has one of the biggest fields in Europe. Also weighing on Regal's share price yesterday were suggestions that the explorer may soon need to raise fresh cash to fund its extensive drilling programme in the Ukraine, Egypt and Romania.

Lower down the pecking order, Medical Marketing International rose 41.5p to a fresh high of 298.5p. Shares in the biotech group have risen from 40p at the beginning of 2004 after positive news from a number of its joint ventures. Among them is a company focused on the treatment of HIV/Aids and one looking to develop a class of chemotherapy compound for the treatment of cancer.

However, KBC Peel Hunturged investors to sell the stock. It believes the company is worth nowhere near the £150m ascribed to it by the market. The broker said: "The recent share price rise for Medical Marketing has placed rather more value on the company than appears warranted following a close inspection of the fundamental value of the company's assets and its near-term commercialisation prospects. By our estimate, the value of Medical Marketing should not be more than £15 to £20m."

Clarkson fell 2.5p to 935p after Martin Stopford, an executive at the shipping broker, sold 62,000 shares at 930p. The disposal halves Mr Stopford's stake in Clarkson and one cannot blame him for pocketing the cash. Shares in the group, which is benefiting from the boom in shipping rates on the back of record demand from China, have risen tenfold over the past five years.

Mothercare lost 6p to 277p as Dresdner Kleinwort Wasserstein cut its forecasts on the children's clothing retailer before its results next week. The German broker warned that the slowdown on the high street will have adversely affected Mothercare.

Prudential 501p (up 23.5p, 4.9 per cent). Replaces its chief executive, Jonathan Bloomer, with Mark Tucker, the man who built up the group's Asia business.

J Sainsbury 293p (up 6p, 2.1 per cent). Unveils a rise in underlying sales for the first time in more than two years.

Somerfield 207p (up 12.5p, 6.4 per cent). Receives a fresh takeover approach from a consortium led by the property tycoon Robert Tchenguiz.

T&F Informa 430.5p (up 20p, 4.9 per cent). Numis Securities urges investors to add to their holdings in the group after an upbeat meeting with its management.

Ultrasis 0.99p (up 0.21p, 26.9 per cent). Says its key anti-depression product has been recommended by the National Institute for Clinical Excellence.

Corpora 20.5p (up 3.5p, 20.5 per cent). First-half losses narrow to £2.3m from £2.6m. The company assures investors that all is going to plan in the second half of its year.

Rensburg 598.5p (up 98.5p, 19.7 per cent). Shares in the fund manager resume trading after it publishes details of its bid for Carr Sheppards.

Red Squared 9.75p (up 1.25p, 14.7 per cent). Announces boardroom reshuffle.

Premier Oil 542.5p (down 11.5p, 2.1 per cent). Full-year results fail to excite the City as profits at the oil explorer slump.

Eurodis Electron 2.12p (down 0.9p, 30.4 per cent). Warns that its relationship with Philips Semiconductor, which accounts for 13 per cent of its revenues, will cease in January 2006.

Longbridge 21.5p (down 7p, 24.5 per cent). Says it will register a loss of £660,000 for the full-year after a more conservative accounting policy.

Aerobox 14.5p (down 2.75p, 15.9 per cent). Full-year pre-tax losses widen to £4m from £2.6m and the group moans about the effects of the high oil price.

Whithead Mann 50.5p (down 5p, 9.0 per cent). Confirms it is in talks with shareholders aimed at raising fresh cash.