The proposed Societe Generale banking merger with Paribas, and the Axa descent on insurer Guardian Royal Exchange, dominated proceedings. For good measure English China Clays agreed a pounds 760m offer from the French minerals group, Imetal.
The SocGen deal provided a shot in the arm to the domestic banking sector with Barclays 31p higher at 1,391p, and National Westminster Bank 39p higher at 1,155p. The French alliance merely reinforced the belief that European banking parlours will witness some anxious and ultimately fruitful merger negotiations in the next few months.
Axa, it would appear, out-bid Royal & Sun Alliance for GRE. Its cash and shares offer comes through Sun Life & Provincial, a 71.6 per cent owned off-shoot. Sun's shares fell 51p to 530p and GRE lost 6.5p to 361p. Royal firmed 21.25p to 483.25p.
English China Clays shaded 1p to 241p. The French offer is worth 250p a share.
Once again the market enjoyed a busy session with turnover again topping 1 billion - at 1.2 billion. The takeover fever enlivened non-Footsie shares with the mid cap index up 97.6 to 5,121.8 and the small cap 23,4 higher at 2,154.6.
The prospect of lower interest rates after this week's Monetary Policy Committee meeting was another influence encouraging the market's strength. A firm New York display also helped.
Engineers, for long unwanted, remained in the grip of bid fever. Morgan Crucible, seemingly in free fall before the sector became engulfed in takeover speculation, jumped a further 22p to 227.5p and Weir, with management changes probably contributing, surged 25.5p to 232p on talk of a US strike. Others enjoying speculative interest included Cookson, 15p to 146.5p, and IMI 23p to 249p.
The excitement also extended to builders, where sentiment has been lifted by some good profits displays. Berkeley, up 51p to 492.5p, was said to be looking at Beazer, up 13p to 156p. Barratt Developments was built up 15p to 223.5p.
Chemicals also enjoyed the scent of bid action, with Croda International 19p up at 242.5p. Albright & Wilson, which admitted the presence of hovering predators on Friday, rose 5p to 104.5p in busy trading. There is talk of an offer coming in at 130p although the shares were near 200p last year.
Tetra, an IT group, was one to actually collect an approach. The shares surged 56p to 243.5p after the company admitted talks. And Delphi, another computer group, was on the bid screen, once it confirmed a potential predator, romping ahead 110p to 485p.
Dixons Motors, 16.5p to 117p, and Fitness First, 18p to 376.5p, were also caught in the bid euphoria. National Grid, announcing its expected strike at US group Eastern Utilities, firmed 5.75p to 500p.
On the pubs pitch Regent Inns frothed ahead 21p to 191p after merger talks with Surrey Free Inns were confirmed. SFI rose 13p to 191.5p.
Corporate activity was also chalked up by Inchcape, up 13p to 149.5p, by the sale of its South American soft drink side for pounds 457m; Glynwed International, 14p higher at 186.5p, on the pounds 19m disposal of its plastics side, and Pilkington Tiles, 1.5p better at 11.75p following the purchase of Woolliscroft Tiles for pounds 1.55m.
BTR and Siebe, in the final throes of their merger, topped the Footsie leader board. BTR rose 14.25p to 123p and Siebe 24.5p to 229.5p. The dual advance was thought to be due to the expectation that some bullish assessments will appear on the new engineering giant once the deal is finally concluded this week.
Tesco improved 4.75p to 192p as it caught the web bug with a free Internet service. Dixons, which has surfed to new highs on its Internet involvement, was at one time down 35p. But such is the appeal of the World Wide Web that it threw off the Tesco influence, as well as a downgrading by HSBC, to end with a 29.5p plus at 1,039.5p.
Rogue trades reappeared on the computerised order book and there appeared to be no evidence they were cancelled. Deals were recorded in Burmah at 866p and 668p with the shades ending at 787p, up 4p. Reuters closed 28.5p higher at 952p.
Profit warnings and disappointing trading performance were, as ever, in the forefront of the day's proceedings. Textile group Worthington was ripped 14p to 30p after warning of lower profits, and Whittard of Chelsea reported lower interim profits and said year's figures would not reach last year's record - sending the shares 1.5p lower to 62.5p.
Furniture retailer Uno dropped 7.5p to 33.5p after running into losses and leisure chain Break for the Border slipped 4.5p to 37p on a flat trading statement. Quality Software fell 15p to 325p but denied stories of a profits warning.
Hanson rose 21p to 413.25p with WestLB Panmure suggesting a 470p target, and Northern Foods put on 5.5p to 118.5p after Warburg Dillon Read provided support.
Aukett Associates, a building design practice, jumped 2p to 9.25p, highest for three years, after an upbeat statement from chairman Gerry Deighton.
SEAQ VOLUME: 1.2bn
SEAQ TRADES: 86,955
GILTS: 116.78 -0.24
PROPERTY ASSET HOLDINGS, an AIM-traded company, seems destined for corporate activity. A major shareholding has changed hands with Stephen Sinclair acquiring a 29.3 per cent stake and, with Charles Helvert, joining the board. The cash-rich company, with residential properties in West London, came to market at the back end of 1997 at around 7p. The shares, down 0.25p at 5.5p, have been as low as 3p.
JOHNSTON, the building materials group, held at 310p as aggressive engineering conglomerate TT lifted its shareholding to 13.32 per cent, seemingly buying shares from Newton Investment Management. A bid looks inevitable.
TT, a steady buyer of the building material group's shares, fell 4p to 156p, a 12-month low. Johnston shares, a narrow market, touched 345p last year but have been as high as 527.5p.