Cadbury on a high as fears of US mauling evaporate

MARKET REPORT
Cadbury Schweppes fizzed to a 12-month high as worries the soft drinks and sweets group was suffering a mauling in the US continued to fade.

Last week's figures and robust presentation has prompted many to revise their view that the British giant is being squeezed unmercifully by the combined might of Coca-Cola and PepsiCo in the fiercely competitive American drinks market. The shares rose 14.5p to 555p in busy trading, only 6p below their all-time high. They were down to 468.5p ahead of the results.

Although there is a widespread suspicion Cadbury's could be tempted into another big swallow, perhaps around the pounds 2bn mark, the stock market has, it appears, drawn reassurance from indications from chief executive John Sunderland that he is reluctant to indulge in any more share issues to finance expansion.

The Cadbury share rush has also been helped by the inevitable takeover speculation. With a near-pounds 5.5bn capitalisation there are not many possible predators; Unilever, known to be on the take-over trail, and Swiss giant Nestle could, however, feature in any action.

Enterprise Oil flared 11.5p to 633.5p ahead of what are expected to be exciting results today which should confirm that the disasters of the abortive Lasmo takeover bid are firmly behind it.

But Enterprise, with an unusually long round of analyst meetings scheduled, could be flexing its muscles for a return to the bid arena.

The market is awash with rumours it will soon be tempted to use its cash pile for expansion. British Borneo Petroleum Syndicate, Cairn Energy and Monument Oil & Gas are among those regarded as possible targets. But the word from Enterprise was there was no chance of a bid accompanying today's figures.

BSkyB shaded to 632p as BZW placed 19.5 million shares with institutions at 628p. The deal will allow smaller shareholders in the satellite television group, such as Next, to realise their stakes. Granada, Pathe and Pearson, with around 12.7 per cent through a vehicle called BSB, say they have no immediate intention of selling more BSkyB shares.

Hanson gained 2p to 303.5p as it managed to cling on its Footsie membership. Compass, the contract caterer which at one time looked likely to edge Hanson into the supporting FTSE 250 index rose 3.5p to 719.5p.

Argos, the catalogue retailer, was the only casualty, as it lost its place to British Land. There was no celebration at British Land, off 9p at 546.5p; Argos fell 5p to 664p.

Footsie's six-day winning run came to an abrupt end. The index suffered a 21.8-points fall to 4,422.5 and the supporting index also lost ground, off 4.3 at 4,725.1. A raft of less than riveting company results helped take the edge off the proceedings. Trading was again lively with turnover reaching 929.1 million shares.

British Petroleum's analysts briefing left the shares 8p lower at 702.5p but Cookson's presentation enhanced its shares 3p to 247p.

Guinness added 2.5p to 476.5p; the price has frothed up from 426p last month. The spirit to stout group is due to present year's figures next week; a modest 2 per cent increase to around pounds 955m is expected with the group a casualty of the strong pound and sluggish whisky markets.

There are suggestions that chairman Tony Greener is thinking in terms of doing the splits - dividing the group into stand-alone beer and spirit companies. Such a demerger, it is argued, would increase shareholder value. The two other leading British spirit groups, Allied Domecq and Grand Metropolitan, have already rejected similar demerger ideas. Break-up talk also resurfaced at BAT Industries, up 7p at 564.5p.

Acorn Computer, on renewed talk of more disc deals, rose 16p to 230.5p and Amstrad, the Alan Sugar electronics vehicle was little changed at 203.5p despite talk of mobile telephone and digital television deals.

JKX Oil & Gas, where Sir Robert Horton (ex-BP) is chairman, fell 9p to 34.5p, perilously close to its 34p rights issue price. The shares were 225p two years ago.

Scotia, the drugs group, remained under pressure following its diabetic drug setback, falling a further 30p to 405p. But Shield Diagnostic's rampant progress continued, up another 62.5p to 717.5p.

Iceland's share buyback overcame a disappointing 23 per cent profit decline to lift the shares 12p to 99.5p.

Campbell & Armstrong, the shopfitter, held at 6.25p. It has acquired for a nominal sum DF Retail Solutions which brings with it sales of pounds 4m.

Taking Stock

Premier Health, a nursing agency, jumped 8.5p to 18p, highest for nearly two years; the shares were 4p last month but touched 120p three years ago. The excitement stems from plans to reorganise its important but troublesome transatlantic operations. There are also hopes the group, formerly called Acsis, has had a strong second half-year.

Springwood, the leisure group run by Adam Page, is riding near its high at 122.5p amid hopes of further expansion moves. Mr Page created the old Midsummer Leisure, taken over after an acrimonious battle.

Wedderburn, the property group, has moved into oil trading through a pounds 5.2m share-exchange reverse takeover of Tempo, a Swiss business. The shares are suspended at 24p.

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