The market is now looking at BT in an entirely different light. The failure to merge with Cable, a deal seen at the time as BT's salvation, is no longer creating anxiety and suddenly there are signs that even the regulatory cold front could be thawing.
The shares gained 9.5p, the best blue chip performance, to 355.5p with the market taking the view that on Monday Oftel, the industry regulator which has squeezed BT with seemingly unrelenting pressure, will offer a fairly kind price cap for the 1997/2001 period.
Some believe there could be pressure on Oftel to tread cautiously after the havoc created by the Ofgas regulator over British Gas.
Just to add to the more relaxed atmosphere, BT has met Oftel price targets and is increasing business and residential line charges. It was enough for stories to circulate that SBC Warburg and Merrill Lynch had lifted their target price for BT shares which earlier this year hit 414p.
The rest of the market was in grand old Duke of York mode. Thursday's 29 points FT-SE 100 index fall was followed by a morning run which took Footsie up 19.8. Then doubts set in. Renewed fears of higher US interest rates, the Israeli election result and continuing political unease on the home front combined to undermine the early strength and the index went into negative territory before closing with a 1.1 points gain at 3,747.8.
Lucas Industries, as its long awaited merger with Varity appeared, was the day's most heavily traded share, with Seaq putting volume at more than 30 million.
The shares rose 14p to 245p with the market divided about whether the tie up with the US car parts group will flush out a bidder. There is talk of a clutch of overseas groups, plus TI Group, eyeing the aerospace and car components business. The US link should make Lucas a firm candidate to rejoin Footsie.
Argyll, the Safeway superstores chain added 8p to 354.5p on the talk of a merger with Asda, off 0.75p at 118.25p.
MFI, the flat pack furniture chain, put on 5p to 184p as ABN Amro Hoare Govett made confident noises and Inchcape, up 10p to 306p, continued to feel the benefit of NatWest Securities support. With consumer spending increasing other retailers were firm with Marks & Spencer (up 4p to 462.5p) on Societe Generale Strauss Turnbull and Merrill recommendations.
Imperial Chemical Industries rose 4p to 853p; stories it planned to sell its 15.8 per cent stake in EVC, Europe's biggest pvc group, are wide of the mark.
Independent Energy started market life at 115p, against a 100p placing, but Stordata Solutions lost 1p to 15p on the abrupt departure of Stephen Sowery. He became chief executive of the computer databank and car alarms group in October when, in a reverse takeover, Stordata merged with the quoted Millgate operation. The shares touched 30p early this year; their performance was not helped by a profit warning in April.
Incepta, the advertising group which used to be called WMGO, slipped 1.5p to 18.5p despite a return to profits, pounds 1.4m against a pounds 2.3m loss. Select Appointments, a recruitment chain, gained 1.5p to 26.5p; it has acquired for pounds 680,000 a French staffing company with branches in Paris and Alsace. It now has 280 offices in 18 countries.
Real Time Control, the computer group, slumped 55p to 259p following the sudden resignation of its chief executive, Brian Emerson. Kelsey Industries, a roofing and insulation contractor, slumped 137p to 453p after announcing interim profits had fallen pounds 302,000 to pounds 1.3m.
Cantab Pharmaceuticals rose 13p to 683p following encouraging trials on its cervical cancer treatment. Said medical director John Roberts: "The signs aren't conclusive but are encouraging". It would, however, be years before any product could be put on the market. Cortecs International gained 3p to 372p on US approval for a peptic ulcer treatment. British Biotech continued to feel the impact of profit taking, falling 45p to 2,750p. Zeneca was also weak, down 21p at 1,371p.
Amey, the construction group, had another good run, gaining 20p to 313p, a peak. The group, expected to score from a British Rail maintenance contract, this week gained Schroders investment arm as a 9.5 per cent shareholder.