Market Report: Asda moves ahead as stories of a pounds 9bn merger retur n

Is the pounds 9bn superstores merger back at the checkout? Shares of Asda jumped 5p to 164.5p as stories circulated it was attempting to get rival Safeway to return to the negotiating table and would launch a hostile strike if its endearments were resisted.

The two groups had summertime talks aimed at creating a third superstores force but dropped the idea after soundings in Westminster indicated the Government would oppose such a deal.

But the stock market believes Asda has since put together a powerful case which it thinks could convince the Government that the get-together, perhaps with certain modifications, should be allowed.

Asda is thought to be keen to point out that a third force could be a more powerful influence in forcing down prices than the two chains operating independently.

A deal would create in some respects the largest supermarket chain in the country, removing Tesco from top spot. Asda's interim figures are due this month and some believe they could be accompanied by a Safeway announcement.

It has made it clear it is seeking acquisitions and has shown it is prepared to move away from its traditional operations by attempting to buy a motorway services chain. Safeway is obviously its preferred option.

Turnover in the two groups was heavy. Safeway moved ahead 1.75p to 323.5p. Last month the shares suffered a sharp reverse when it was revealed profits might not be much different from last year's pounds 420.6m.

Before the warning, Safeway was riding at around 400p. The shares have since been down to 319p. Their weakness could persuade Asda the chain is ripe for attention.

The Government's controversial savings changes, with supermarkets likely to be at the forefront in selling the new Individual Saving Accounts, also helped the sector, with J Sainsbury 4p firmer at 501p and Tesco up 13p to 495p. Banks are also in line for ISA sales success; Halifax rose 19p to 714.5p.

The arrival of ISAs will not be particularly rewarding for many diligent savers, who will face unexpected tax liabilities, and the more traditional saving groups. Unit trust groups Perpetual and M&G were hit, falling 177.5p to 2,420p and 42.5p to 1,352.5p respectively.

Footsie ended near its day's best, up 55.8 points to 4,977.6. The possibility that the Monetary Policy Committee may be tempted to lift interest rates again caused some anxiety but the overnight performances of New York and Hong Kong offered reassurance.

National Westminster Bank duly announced its departure from investment banking with the bulk of its equities business going to Bankers Trust and Deutsche Bank. The shares edged ahead 13p to 898p.

Hambros, the merchant bank, was 16p higher at 267p on hopes of a Societe Generale strike.

BICC, the cables and construction group, jumped 10p (after 15.5p) to 162p after Henderson Crosthwaite held an investment dinner at London's Howard Hotel. The company put on a positive performance and the share reaction recharged some of the old takeover stories with talk of Continental strikes.

Henderson was also at the Savoy Hotel, hosting a dinner for computer group Alphameric, up 2p to 53.5p.

Engineer Siebe rose 38p to 1,163p on its interim figures and today's analyst visit to its US operations. An upbeat trading statement lifted Williams 9.25p to 329.25p.

Nycomed Amersham strengthened 32.5p to 2,057.5p after the US Food & Drug Administration cleared its Teslascan treatment for liver disease.

Merrydown, the drinks group, added 15p to 65.5p on the prospect of bid action and Eldridge Pope, the pubs chain, put on 24p to 294p on its new votes-for-all policy. Continuing bid hopes lifted Zetters 6.5p to 131.5p.

Ramco Energy added 17.5p to 795p. There is talk it is on the verge of clinching an intriguing deal in Azerbaijan where it already has extensive interests. Earlier this year it failed in a bid to take over JKX Oil & Gas when Ukrainian interests moved in and blocked what had appeared to be a successful bid.

News
peopleFrankie Boyle responds to referendum result in characteristically offensive style
News
news
Arts and Entertainment
musicHunter Davies has collected nearly a hundred original  manuscripts
News
news
PROMOTED VIDEO
New Articles
i100
Life and Style
lifeAiming to show breasts in a non-sexual way for cancer awareness
New Articles
i100... while following the referendum
News
ebooksAn unforgettable anthology of contemporary reportage
New Articles
i100... with this review
Voices
Holly's review of Peterborough's Pizza Express quickly went viral on social media
Arts and Entertainment
Nick Frost will star in the Doctor Who 2014 Christmas special
tvNick Frost, Natalie Gumede and Michael Troughton step up
Arts and Entertainment
Matthew Beard, Ben Schnetzer, Douglas Booth and Jack Farthing in ‘The Riot Club’
filmReview: Sheer nastiness of Riot Club takes you aback
Arts and Entertainment
tvBut something’s not quite right
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

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

iJobs Job Widget
iJobs Money & Business

Senior BA - Motor and Home Insurance

£400 - £450 Per Day: Clearwater People Solutions Ltd: **URGENT CONTRACT ROLE**...

Market Risk & Control Manager

Up to £100k or £450p/d: Saxton Leigh: My client is a leading commodities tradi...

SQL Developer - Watford/NW London - £320 - £330 p/d - 6 months

£320 - £330 per day: Ashdown Group: The Ashdown Group have been engaged by a l...

Head of Audit

To £75,000 + Pension + Benefits + Bonus: Saxton Leigh: My client is looking f...

Day In a Page

Mystery of the Ground Zero wedding photo

A shot in the dark

Mystery of the wedding photo from Ground Zero
His life, the universe and everything

His life, the universe and everything

New biography sheds light on comic genius of Douglas Adams
Save us from small screen superheroes

Save us from small screen superheroes

Shows like Agents of S.H.I.E.L.D are little more than marketing tools
Reach for the skies

Reach for the skies

From pools to football pitches, rooftop living is looking up
These are the 12 best hotel spas in the UK

12 best hotel spas in the UK

Some hotels go all out on facilities; others stand out for the sheer quality of treatments
These Iranian-controlled Shia militias used to specialise in killing American soldiers. Now they are fighting Isis, backed up by US airstrikes

Widespread fear of Isis is producing strange bedfellows

Iranian-controlled Shia militias that used to kill American soldiers are now fighting Isis, helped by US airstrikes
Topshop goes part Athena poster, part last spring Prada

Topshop goes part Athena poster, part last spring Prada

Shoppers don't come to Topshop for the unique
How to make a Lego masterpiece

How to make a Lego masterpiece

Toy breaks out of the nursery and heads for the gallery
Meet the ‘Endies’ – city dwellers who are too poor to have fun

Meet the ‘Endies’ – city dwellers who are too poor to have fun

Urbanites are cursed with an acronym pointing to Employed but No Disposable Income or Savings
Paisley’s decision to make peace with IRA enemies might remind the Arabs of Sadat

Ian Paisley’s decision to make peace with his IRA enemies

His Save Ulster from Sodomy campaign would surely have been supported by many a Sunni imam
'She was a singer, a superstar, an addict, but to me, her mother, she is simply Amy'

'She was a singer, a superstar, an addict, but to me, her mother, she is simply Amy'

Exclusive extract from Janis Winehouse's poignant new memoir
Is this the role to win Cumberbatch an Oscar?

Is this the role to win Cumberbatch an Oscar?

The Imitation Game, film review
England and Roy Hodgson take a joint step towards redemption in Basel

England and Hodgson take a joint step towards redemption

Welbeck double puts England on the road to Euro 2016
Relatives fight over Vivian Maier’s rare photos

Relatives fight over Vivian Maier’s rare photos

Pictures removed from public view as courts decide ownership
‘Fashion has to be fun. It’s a big business, not a cure for cancer’

‘Fashion has to be fun. It’s a big business, not a cure for cancer’

Donatella Versace at New York Fashion Week