Once again the stock market was spellbound by New York. Early falls evaporated once it became clear the Dow Jones Average would open with a swing.
In what has been a week of confusion, Footsie has fallen 127.9, a far more resilient outcome than seemed likely when shares were in free-fall with the index off a 457.9, its biggest points fall.
It was almost as if the market was so relieved with the peaceful atmosphere which rounded off a chaotic week that it did not want to tempt fate by indulging in anything quite so crude as good, old- fashioned robust trading. Turnover was an unexciting 580.8 million shares.
Banks attracted attention. National Westminster Bank's rejection of the suspected Deutsche Morgan Grenfell bid for its equities and research operations caught the market on the hop with NatWest tumbling 43p to 857p. The terms were not revealed but DMG said it would not increase its offer.
Barclays slipped 5p to 1,493p. CreditSuisse First Boston emerged as the favourite to capture its up-for-sale securities side, BZW. Bankers Trust of New York dropped out of the race and another US group, Donaldson Lufkin & Jenrette, at one time thought to be in the running for the NatWest operation, is also thought to have cooled over the Barclays offshoot.
M&G, the unit trust group which has sadly underperformed the market, found itself the focus of takeover speculation. The shares rose 47.5p to 1,205p. Halifax, off 10p to 675p, was the rumoured predator. M&G recently undertook a reorganisation of its trusts to counter criticism and try to improve its performance.
Halifax is thought to be keen to flex its muscles. A move into unit trusts could well appeal to the acquisitive aspirations of the Halifax management. M&G, which made profits of pounds 64.5m last year, is valued at around pounds 900m, an easy enough swallow for the building society-cum-bank.
British Petroleum, ahead of third-quarter figures next week, gained 10.5p to 876p. Shell, also on the third-quarter treadmill next week, hardened 3.75p to 422.75p. Lasmo's Libyan oil strike was responsible for adding a further 9p to 275p.
British Biotech, once the heart-throb of the biotech industry, had another unsettling session. The shares were at one time down to 96p. They closed off 1p at 101.5p, a year's low.
JD Wetherspoon, the pubs chain, jumped 32.5p to a 1,615p peak. There is talk of bid action but the strength of the shares could be in anticipation of this month's five-for- one share split which will improve marketability.
Greenalls, up 16.5p to 353p, enjoyed revived takeover speculation and talk of asset sales.
Redland, the building materials group which has rejected the advances of Lafarge, the French group, rose 9p to 340p. Graham, a builders merchant regarded as a likely bid target, gained 11p to 164p.
Vickers, the defence group which has put its Rolls-Royce car business up for sale, purred ahead 6p to 228p on speculation it has nearly clinched a major tank deal. Oman is said to be near to agreeing a pounds 100m order for Challenger 2 tanks. Vickers refused to confirm the speculation but said Oman already had Challenger 2 tanks and admitted: "There have been discussions about further buys."
The day after the celebratory AIM dinner, one of the junior market's constituents blotted its copybook with a profits warning. Total Office, providing office systems, slumped 44p to 82.5p.
Memory Corporation, the computer group, added 5p to 45p following a deal with a Taiwanese concern which has an option on Memory shares at 38.5p. The Taiwan group will use the Microlock chip, which is difficult to switch between computers. Microlock is seen as providing protection against chip theft. Stockbroker Beeson Gregory think the shares, which hit 547.5p in the heady, unchallenged days of 1995, are worth 85p.Reuse content