Appetite for blue chips powers Footsie to record high

MARKET REPORT

Shares, as measured by the blue-chip FT-SE 100 index, stretched to another closing high, with a strong New York opening and the prospect of lower base rates providing much of the momentum.

Even the failure of the much-rumoured big takeover bid to appear failed to dampen the enthusiasm.

For the fourth day running, Footsie powered ahead, with a 25.3-point gain pushing the reading to 3,557.7. Its earlier peak, reached last month, was 3,535.7.

But the current upsurge is very much a blue-chip affair. The supporting FT-SE 250 index is experiencing a far more subdued time. Although it is reaching new highs for the year, gaining 3.7 to 3,952.2 yesterday, it is still just over 200 points below its peak, achieved last year when blue chips were also riding high.

A two-tier market is a development that could create anxiety. Are blue chips running ahead of the game? Will supporting shares eventually catch up? Such questions are occupying many a City mind, with the likelihood the second-liners will at least narrow the gap seemingly the favourite guess.

The current round of profit figures are, of course, important. So far, the string of results have been marginally disappointing. The crunch could come today, with nine Footsie companies, including Glaxo Wellcome, reporting.

Takeover action is also essential. This year has already been dubbed the year of the mega-bid, with cash offers of around pounds 20bn completed or going through.

Institutions, even before the bid bonanza, were cash-rich and now find themselves with an embarrassment of uninvested wealth.

Their problem could become more acute. More bids are likely, particularly for utilities, with many of the predators based overseas and obliged to offer cash.

Today's Ken and Eddie meeting on interest rates could also offer a few clues which, if encouraging, will be highlighted by the market's growing band of bulls.

On the profits front, RTZ pleased with a 33.5 per cent advance producing a 25p gain to 905p. But NFC fell 6p to 160p and Iceland 9p to 184p on disappointment with the company's results.

Barclays rose 13p to 752p as institutions involved in last month's 25 million share buy-back became eligible to pick up stock.

SmithKline Beecham added 12p to 617p, with some wondering if Roche, the Swiss group for long the rumoured suitor for Zeneca, could switch its attention. A much more likely reason for the advance was buy support from Merrill Lynch, the US investment house. Royal Insurance was another attracting bid speculation, up 6p at 345p.

As expected, BSkyB is to become a constituent of the 100 index. Its inclusion is conditional on Pearson selling most of its 9.75 per cent stake, a development the banking and media group is well on the way to completing. BSkyB gained 10p to 361p.

Fisons, struggling to resist the attentions of Rhone-Poulenc Rorer, has also returned to Footsie, together with Lasmo. Caradon, United Biscuits and MEPC have lost their places.

UB rose 3p to 280p as Barclays de Zoete Wedd completed an 8 million-plus trade at around 275p.

ML Laboratories, with a market value of pounds 330m, is joining the supporting 250 index. It is the first time a USM-traded share has enjoyed such exotic status. ML shares, strong on what is regarded as encouraging progress with an Aids drug, rose 15p to 241p.

Matthew Clark, by common consent the unidentified bidder for Taunton Cider, fell 34p to 625p. Taunton fizzed up another 5.5p to 218p.

Kingfisher managed to shrug off Kleinwort Benson sell advice, gaining 1.5p to 459.5p. Signet, the struggling jeweller, held at 15p.

Parcon Managers, an investment group closely related to South African investors Julian Treger and Brian Myerson, has lifted its stake to 14.1 per cent.

The T/M camp, expected to make a statement today, now has more than 18 per cent of Signet and will probably mount a fierce attack on the board at Monday's shareholders meeting. Earlier this year the South Africans unsuccessfully pres-sed for Signet to be broken up.

Scholl, the healthcare group, was little changed at 238p as Messrs Treger and Myerson and friends submitted their formal request for a special shareholders' meeting to oust half the existing board.

Eurotunnel added 3p to 155p on hopes the banks will put together a stop- gap financial package.

TAKING STOCK

o Rentokil, the pest control and healthcare company controlled by a Danish group, Sophus Berendsen, plans its first US road show. Later this month it will hold investment meetings in New York and Boston. Around 3 per cent of its shares are held in the US. The group, which had sales of pounds 63.4m in the US in the first half of this year, launched an ADR issue a year ago. The shares rose 4p to 306p.

o Aminex, the resources group with growing interests in the former Soviet Union, has raised more than pounds 600,000 through a share sale at 60p. The placing was handled by Riada, the Dublin stockbrokers. Aminex, which has increased its proven and possible reserves through a deal in the Komi Republic, is thought to be working on another significant venture. The shares held at 60p.

Suggested Topics
Start your day with The Independent, sign up for daily news emails
ebooks
ebooksA celebration of British elections
  • Get to the point
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Ashdown Group: Editor-in-chief - Financial Services - City, London

£60000 - £70000 per annum + benefits : Ashdown Group: A highly successful, glo...

Ashdown Group: Junior Application Support Analyst - Fluent German Speaker

£25000 - £30000 per annum + benefits: Ashdown Group: A global leader operating...

Guru Careers: Management Accountant

£27 - 35k + Bonus + Benefits: Guru Careers: A Management Accountant is needed ...

Guru Careers: Project Manager / Business Analyst

£40-50k + Benefits.: Guru Careers: A Project Manager / Business Analyst is nee...

Day In a Page

General Election 2015: ‘We will not sit down with Nicola Sturgeon’, says Ed Balls

'We will not sit down with Nicola Sturgeon'

In an exclusive interview, Ed Balls says he won't negotiate his first Budget with SNP MPs - even if Labour need their votes to secure its passage
VE Day 70th anniversary: How ordinary Britons celebrated the end of war in Europe

How ordinary Britons celebrated VE Day

Our perception of VE Day usually involves crowds of giddy Britons casting off the shackles of war with gay abandon. The truth was more nuanced
They came in with William Caxton's printing press, but typefaces still matter in the digital age

Typefaces still matter in the digital age

A new typeface once took years to create, now thousands are available at the click of a drop-down menu. So why do most of us still rely on the old classics, asks Meg Carter?
Discovery of 'missing link' between the two main life-forms on Earth could explain evolution of animals, say scientists

'Missing link' between Earth's two life-forms found

New microbial species tells us something about our dark past, say scientists
The Pan Am Experience is a 'flight' back to the 1970s that never takes off - at least, not literally

Pan Am Experience: A 'flight' back to the 70s

Tim Walker checks in and checks out a four-hour journey with a difference
Humans aren't alone in indulging in politics - it's everywhere in the animal world

Humans aren't alone in indulging in politics

Voting, mutual back-scratching, coups and charismatic leaders - it's everywhere in the animal world
Crisp sales are in decline - but this tasty trivia might tempt back the turncoats

Crisp sales are in decline

As a nation we're filling up on popcorn and pitta chips and forsaking their potato-based predecessors
Ronald McDonald the muse? Why Banksy, Ron English and Keith Coventry are lovin' Maccy D's

Ronald McDonald the muse

A new wave of artists is taking inspiration from the fast food chain
13 best picnic blankets

13 best picnic blankets

Dine al fresco without the grass stains and damp bottoms with something from our pick of picnic rugs
Barcelona 3 Bayern Munich 0 player ratings: Lionel Messi scores twice - but does he score highest in our ratings?

Barcelona vs Bayern Munich player ratings

Lionel Messi scores twice - but does he score highest in our ratings?
Martin Guptill: Explosive New Zealand batsman who sets the range for Kiwis' big guns

Explosive batsman who sets the range for Kiwis' big guns

Martin Guptill has smashed early runs for Derbyshire and tells Richard Edwards to expect more from the 'freakish' Brendon McCullum and his buoyant team during their tour of England
General Election 2015: Ed Miliband's unlikely journey from hapless geek to heart-throb

Miliband's unlikely journey from hapless geek to heart-throb

He was meant to be Labour's biggest handicap - but has become almost an asset
General Election 2015: A guide to the smaller parties, from the the National Health Action Party to the Church of the Militant Elvis Party

On the margins

From Militant Elvis to Women's Equality: a guide to the underdogs standing in the election
Amr Darrag: Ex-Muslim Brotherhood minister in exile still believes Egypt's military regime can be replaced with 'moderate' Islamic rule

'This is the battle of young Egypt for the future of our country'

Ex-Muslim Brotherhood minister Amr Darrag still believes the opposition can rid Egypt of its military regime and replace it with 'moderate' Islamic rule, he tells Robert Fisk
Why patients must rely less on doctors: Improving our own health is the 'blockbuster drug of the century'

Why patients must rely less on doctors

Improving our own health is the 'blockbuster drug of the century'