Hopeful US investors power Vodafone to new peak

MARKET REPORT

Vodafone, the mobile telephone group, is dialling the best stock market numbers. With enthusiasm continuing to grow about the cellular radio market - and the nagging suspicion the group will attract a US take over bid - the shares zipped to a new 272.5p peak, up 7p.

The company already has a large US fan club, with more than 40 per cent of its shares thought to be held by American investors who are attracted by the relatively low rating of its shares compared with similar US telephone groups.

The latest share upsurge is thought to reflect continued US buying. But trans-Atlantic influences do not enjoy exclusivity to the Vodafone line.

The group has met institutional investors in recent weeks and a number of UK stockbrokers have waxed lyrical about the shares. NatWest Securities has suggested Vodafone is the fastest growing FT SE constituent and indicated the price should be 300p. Societe Generale Strauss Turnbull is another bull of the shares.

Since being split from Racal Electronics seven years ago Vodafone has been as low as 78p.

The rest of the stock market tended to laze in the summer sunshine with the FT-SE 100 index climbing 5.5 points to 3,470.6, with encouraging inflation figures overshadowing a poor New York opening.

Currency influences again had an impact. Inchcape's recovery continued with the shares up 7p to 353p; Grand Metropolitan, enjoying the added ingredient of investment presentations, was 5.5p higher at 418p.

P&O rose 12p to 565p as SGB Warburg suggested the shares had fallen too steeply but Amersham International dipped 11p to 988p as NatWest trimmed its profit forecast. BSkyB, the satellite television group, rose 2.5p to 345p on its results but Pearson, confirming its intention to sell its stake, fell 11p to 622p.

Shell gained 6.5p to 734p on Goldman Sachs support while Enterprise Oil slipped 5p to 371p as speculation resurfaced it is planning to sell its 9.8 per cent shareholding in former bid target Lasmo.

Scottish & Newcastle rose 6p to 607p. Director Trevor Hemmings sold 250,000 shares at 601p and now has 18.4 million shares. Mr. Hemmings is a big shareholder in Farringford, the shell company where rumours of a deal are going the rounds. Morland, capturing Unicorn Inns in an pounds 11m deal, lost 5p to 545p. Regent Inns, the unsuccessful bidder, was also marked down 5p, to 475p.

Building shares remained weak with the prospect of another housebuilder sale, BICC's Clark Homes, increasing the already deep gloom in the industry. Tarmac and, it is thought, Trafalgar House already have their house building businesses on the market.

Glaxo Wellcome was a shade easier following negative comments about its Retrovir AIDs drug in the influential New England Journal of Medicine. The journal apparently suggests Retrovir is having little effect in early treatment of the disease. Such a finding is not surprising following earlier investigations. Retrovir, however, represents only 3 per cent of Glaxo's turnover. Zeneca ran into further profit-taking after its recent strong run, falling 15p to 1,107p.

Hanover International arrived on the hotel pitch. Against a 100p offer price the shares closed at 125p. The company is the creation of Peter Eyles, son-in-law of the late Sir Maxwell Joseph, creator of Grandmet. Mr. Eyles - former head of the Norfolk Capital hotel chain - is expected to embark on a rapid Hanover build-up, acquiring hotels for shares. It has already acquired the 98 bedroom Imperial Hotel in Cork from Bridgend, which holds 47 per cent of Hanover. Bridgend held at 15p.

Brockbank, a Lloyds managing agency, arrived on AIM, climbing 5p to 205p. The group, which takes in the Admiral direct insurance operation, achieved profits of pounds 3.5m in the first half of its current year. Gowring, the car dealer which also operates Burger King fast food outlets, rose 3p to 86p. The family-controlled group has climbed from 67p since the start of last month.

Halkin, the luxury goods and duty free group, held at 63p. Williams de Broe believes profits this year will hit pounds 5m with pounds 6.2m likely in the following year. It believes the shares are cheap.

Intercare, with pounds 7m of cash and net assets worth 55p a share, should achieve profits of pounds 2.2m this year, believes Greig Middleton. The group has sold its optical division and now produces wheelchairs and distributes medical products. The shares stuck at 62p.

Canadian Pizza, awaiting take over developments, fell a further 6p to 89p. The shares have lost all but 3p of their gain following last week's announcement that a bid approach had been received.

DATA BANK

FT-SE 100 3470.6 +5.5

FT-SE 250 3870.4 +7.9

FT-SE 350 1730.8 +2.9

SEAQ VOLUME 593.7m shares, 23,000 bargains

Gilts Index 93.04 +0.15

TAKING STOCK

o Enviromed, the medical group, shaded to 39p. Its directors are due to meet next week to consider a bid from its management and an unidentified third party. With talk in the industry that UK and US bidders are circling, the terms will come under close scrutiny. The company was floated at 110p two years ago. Its shares crashed when it issued a profit warning in June.

o It was just like the Irish oil bonanza of the 1980s. Petroceltic, traded on the Irish exploration market, jumped 9p to 39p (after 41p) as stories buzzed of a big gas find off the coast near Cork. According to some reports flares had been seen from the shoreline; others said they had been spotted from aircraft. Petroceltic remained silent but the Irish resources community is convinced it has made a rich strike.

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