The latest deluge of company results was regarded as a little disappointing, and with the summer heatwave hitting August shop sales the stock market could discover little incentive to move ahead.
It did manage to do so in early trading. But once the Whitehall messages, which also included uninspiring inflation figures, were factored into the system, shares drifted lower with a few traders looking to lock in profits.
The futures market offered little help. A high open interest ahead of today's expiry of September FT-SE futures added to the downward pressure.
Insurances were the front-runners. Prudential continued to draw strength from results, gaining a further 13.5p to 370p. With Legal & Gen- eral improving 18p to 565p on its interim figures and talk of corporate action stirring the sector other prices moved ahead.
Commercial Union added 13p to 623p and General Accident, expected to acquire Provident Mutual soon, 6p to 650p; Lloyds Abbey Life, with talk that the new round of activity could produce the long-suspected bid, rose 9p to 433p.
But Royal Insurance, long one of the industry's bid favourites, fell 3p to 369p.
British Aerospace, up 27.5p to 677.5p, was the top-performing blue chip, reflecting better-than-expected figures. P&O dipped 31p to 506p (although the feared rights issue did not materialise) and United Biscuits crumbled 7.5p to 268.5p.
National Westminster Bank attracted attention in a firm banking sector, gaining 13.5p to 627.5p.
Buy advice from US house Lehman Brothers has coincided with a growing belief the bank is near to selling its US arm, NatWest Bancorp.
It would be an ideal time for NatWest to cash in. With US banks engulfed in a frenzy of takeover activity it should be in a position to command a rich price.
WPP, the advertising group once deep in despair, improved 7p to 163p as ABN Amro Hoare Govett put a buy sign over the shares following an investment presentation.
Guinness, up 5p to 532p, continued to draw strength from the increase in first half-year Scotch whisky exports; Grand Metropolitan improved 5p to 430p on an upbeat trading statement. The main domestic brewers, Bass and Scottish Courage, gave ground.
Eurotunnel plunged to a new low after it was forced into freezing interest payments. With fears of yet another looming cash-raising operation the shares were for a time 20p lower. They closed 14p off at 142p.
Alumasc, a maker of beer kegs, jumped 57p to 435p as it proposed a pounds 35.2m bid for engineer Benjamin Priest. It is raising pounds 25.5m through a three- for-11 rights issue at 320p.
Diploma, the electrical distributor, fell 18p to 440p as James Capel said sell, but Filtronic Comtek, a maker of mobile telephone parts, returned to favour with a 30p gain to 448p. The shares were floated at 105p a year ago.
Parkside duly collected its bid with British Polythene offering pounds 24m. The shares held at 76p. But My Kinda Town, the theme restaurant chain, fell 0.75p after suitor Groupe Chez Gerard withdrew from bid talks. Price, it seems, took the deal off the menu. But the way some early share offerings of MKT were snapped up prompted talk that another bidder hovered.
There was heady excitement on the Alternative Investment Market with three newcomers. One was Preston North End, the fourth football club to obtain a share quote. The shares opened at 400p but attracted little interest.
SCS Satellite Communications, providing television advertising services for retailers, traded at 130p and Lawrie, a plantation owner, moved from the 4.2 market at 2,750p.
Memory Corporation, which has developed a system for repairing defective computer chips, had an active time on the soon-to-disappear 4.2 market, moving from around 380p to 450p. It is due to become an AIM constituent on Monday.
On the main market British Biotech responded to successful phase two trials of its pancreatitis drug with a 69p gain to 694p.
Fortune Oil, with interests in China, was busily traded, gaining 0.5p to 7.5p, but Emerald Oil, the recent subject of a big share placing when Pacific Media sold its 9.5 per cent stake, shaded 0.5p to 1.75p.
Brackenbridge rose 0.5p to 4.25p.
o John Ritblat, head of the British Land property group, has descended on little Artesian Estates, the assured tenancy investment concern that came to market a year ago. As the result of the pounds 2.3m acquisition of companies owning more than 23,000 resi- dential properties Mr Ritblat will receive shares giving him 12.3 per cent of Artesian, up 2p at 88p
o High excitement on the 4.2 market in the shares of Electrophoretics International. The shares, around 43p on Monday, commanded a 75p price yesterday. The company has raised pounds 1m and is in the process of pulling in another pounds 1m through share sales. It should have the cash by the time it moves to AIM early next month. EI is producing a blood-testing system capable of detecting a variety of health problems.Reuse content