`Major factor' sees share values soaring by pounds 9.8bn


The Major factor lifted the FT-SE 100 index 45.7 points to 3,394.9, adding more than pounds 9.8bn to stock market values, according to Datastream calculations.

Initially, shares greeted the Tory result with reservation. But then confidence grew. The ending, at least for the time being, of political uncertainty, a new-look Cabinet and signs of genuine investment buying did the trick.

Another impressive New York display, with the Dow Jones Average romping above 4,600 for the first time, a strong futures market and indications of a big buy programme also helped. So did growing hopes for lower interest rates in the US and Europe.

US investors could in the next few weeks provide the real power for the market. New York's remarkable run means they are experiencing increasing difficulty finding what they regard as realistic value.

They are turning their attention to overseas markets and London, which has lagged behind New York, must be offering the sort of value they are denied at home.

The market has been decidedly groggy since John Major's resignation. Even after yesterday's advance the index is still 9 points below its level before the leadership campaigns started to roll.

At one time the FT-SE 100 was above 3,400. It faded a little in the final 30 minutes. Government stocks managed gains of up to 19 ticks.

Glaxo Wellcome was one to miss the party. It fell 9p to 760p on worries about squeezed profits in Germany, where its Zantac ulcer drug is losing patent protection.

GEC's disappointing results left the shares 4p off at 305p and Compass, the caterer, suffered a 27p bite to 345p on its French acquisition plans.

Yorkshire Chemical tumbled 49p to 298p following a profit warning.

But blue dominated the proceedings. GRE, the insurer, was the best-performing Footsie constituent, up 12p at 216p. Wolseley, weak recently on the dull building outlook, was galvanised 13.5p higher to 366p on those US interest rate hopes.

Utilities were in demand with waters flowing strongly. Thames added 13p to 487p and Severn Trent 15p at 569p.

Electricities lost a little of Tuesday's enthusiasm but still moved ahead as political considerations mingled with expectations that Professor Stephen Littlechild, the industry regulator, will not be too harsh when he produces his pricing review tomorrow.

MFI, the flat-pack furniture group, gained 7p to 124p. James Capel expects a modest profit advance to pounds 69m this year but points out it would not require much of an improvement in sales and product mix to produce pounds 85m next year.

Thorn EMI jumped 28p to 1,343p as speculation about the sale of its music division resurfaced and Kwik Fit, the discounter, attracted late demand, gaining 17p at 674p.

Lonrho shaded to 151.5p as analysts continued to warm to the shares. William de Broe produced a buy note, suggesting assets could be 226p a share. Another enthusiast, T Hoare, estimated 219p.

Lucas Industries, the vehicle components group, moved ahead 5.5p to 197p on suggestions it could be the Footsie replacement for SG Warburg.

Boddingtons, the pubs chain, dipped 3.5p to 266.5p on Kleinwort Benson caution. The big brewers, it feels, are adopting a much tougher pricing approach, prompting it to clip pounds 1.5m from its Boddies forecast to pounds 31.9m.

Kleinwort believes discounts, particularly to the smaller wholesalers, are being reduced sharply. Bass, up 13p at 622p, no longer feels the need to chase market share. Gibbs Mew, which demonstrated on Tuesday the tightening conditions in the beer market, lost a further 38p to 383p, a two-day fall of 49p.

Aminex, the Irish oil group, due to move to a full listing today, held at 60p on the Irish exploration market. The biggest shareholder is Zarubezneft, the Russian government-owned oil company.

At 60p Aminex is valued at pounds 20m. Supporters of the Irish group point out that JKX, on its way to market with a capitalisation of around pounds 130m, has proven and probable reserves in the former Soviet Union of 31 million barrels. Aminex could soon have between 24 and 35 million. It is already producing and enjoys favourable Russian tax treatment.

VideoLogic's increased loss left the shares 10p down at 25p; Microgen, the computer group, jumped 20p to 149p on a 30 per cent profit increase.

Costain, the troubled construction group, rose 3p to 110p on the arrival of another Middle Eastern shareholder with 3 per cent.

Kelsey Industries, an audio accessories and roofing group, was the day's top performer, up 20.8 per cent at 505p in an exceedingly narrow market.


o Stirrings at United Energy, the USM-traded oil group. Big trades this week include the sale of a 4 per cent interest by former director Tony Alderton. There is talk of possible stake building with a view to a revamping exercise. It is thought Mr Alderton is keen to concentrate on Greenhills, a 4.2 traded company, where he is chairman. Greenhills is developing theme restaurants in central London with the US group Turner Home Entertainments and Baldwin, the holidays restaurants group. UE shares held at 12p and Greenhills at 18p.

o The next AIM recruit is Scruttons, an industrial services and shipping group. It is moving from the 4.2 market and dealings are expected to start today. The chairman is Sir Peter Parker, the former British Rail boss.

Start your day with The Independent, sign up for daily news emails
New Articles
tvDownton Abbey Christmas special
Arts and Entertainment
Wolf (Nathan McMullen), Ian (Dan Starky), The Doctor (Peter Capaldi), Clara (Jenna Coleman), Santa Claus (Nick Frost) in the Doctor Who Christmas Special (BBC/Photographer: David Venni)
tvOur review of the Doctor Who Christmas Special
peopleIt seems you can't silence Katie Hopkins, even on Christmas Day...
Arts and Entertainment
Left to right: Stanley Tucci, Sophie Grabol and Christopher Eccleston in ‘Fortitude’
tvSo Sky Atlantic arrived in Iceland to film their new and supposedly snow-bound series 'Fortitude'...
Arts and Entertainment
Jenna Coleman as Clara Oswald in the Doctor Who Christmas special
tvForget the rumours that Clara Oswald would be quitting the Tardis
Arts and Entertainment
Japanese artist Megumi Igarashi showing a small mascot shaped like a vagina
The Queen delivers her Christmas message
newsTwitter reacts to Her Majesty's Christmas Message
Arts and Entertainment
Life and Style
ebooksA year of political gossip, levity and intrigue from the sharpest pen in Westminster
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating

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

iJobs Job Widget
iJobs Money & Business

Selby Jennings: Oil Operations

Highly Competitive: Selby Jennings: Our client, a leading European Oil trading...

The Jenrick Group: Night Shift Operations Manager

£43500 per annum + pension + holidays: The Jenrick Group: Night Shift Operatio...

SThree: Trainee Recruitment Consultant - LONDON

£20000 - £25000 per annum + OTE £40,000 + Car + Pension: SThree: SThree are a ...

SThree: Trainee Recruitment Consultant

£20000 - £25000 per annum + OTE £35K: SThree: We consistently strive to be the...

Day In a Page

A Christmas without hope: Fears grow in Gaza that the conflict with Israel will soon reignite

Christmas without hope

Gaza fears grow that conflict with Israel will soon reignite
After 150 years, you can finally visit the grisliest museum in the country

The 'Black Museum'

After 150 years, you can finally visit Britain's grisliest museum
No ho-ho-hos with Nick Frost's badass Santa

No ho-ho-hos with Nick Frost's badass Santa

Doctor Who Christmas Special TV review
Chilly Christmas: Swimmers take festive dip for charity

Chilly Christmas

Swimmers dive into freezing British waters for charity
Veterans' hostel 'overwhelmed by kindness' for festive dinner

Homeless Veterans appeal

In 2010, Sgt Gary Jamieson stepped on an IED in Afghanistan and lost his legs and an arm. He reveals what, and who, helped him to make a remarkable recovery
Isis in Iraq: Yazidi girls killing themselves to escape rape and imprisonment by militants

'Jilan killed herself in the bathroom. She cut her wrists and hanged herself'

Yazidi girls killing themselves to escape rape and imprisonment
Ed Balls interview: 'If I think about the deficit when I'm playing the piano, it all goes wrong'

Ed Balls interview

'If I think about the deficit when I'm playing the piano, it all goes wrong'
He's behind you, dude!

US stars in UK panto

From David Hasselhoff to Jerry Hall
Grace Dent's Christmas Quiz: What are you – a festive curmudgeon or top of the tree?

Grace Dent's Christmas Quiz

What are you – a festive curmudgeon or top of the tree?
Nasa planning to build cloud cities in airships above Venus

Nasa planning to build cloud cities in airships above Venus

Planet’s surface is inhospitable to humans but 30 miles above it is almost perfect
Surrounded by high-rise flats is a little house filled with Lebanon’s history - clocks, rifles, frogmen’s uniforms and colonial helmets

Clocks, rifles, swords, frogmen’s uniforms

Surrounded by high-rise flats is a little house filled with Lebanon’s history
Return to Gaza: Four months on, the wounds left by Israel's bombardment have not yet healed

Four months after the bombardment, Gaza’s wounds are yet to heal

Kim Sengupta is reunited with a man whose plight mirrors the suffering of the Palestinian people
Gastric surgery: Is it really the answer to the UK's obesity epidemic?

Is gastric surgery really the answer to the UK's obesity epidemic?

Critics argue that it’s crazy to operate on healthy people just to stop them eating
Homeless Veterans appeal: Christmas charity auction Part 2 - now LIVE

Homeless Veterans appeal: Christmas charity auction

Bid on original art, or trips of a lifetime to Africa or the 'Corrie' set, and help Homeless Veterans
Pantomime rings the changes to welcome autistic theatre-goers

Autism-friendly theatre

Pantomime leads the pack in quest to welcome all