Market Report: BT rises to the part of hopeful entertainer

The specialist engineer J Billam jumped 37p to 289p as sisters Barbara Billam, a director, and Jennifer Knapp, each sold 32,950 shares to a company called Three In Eleven. But hopes of a bid died as the oddly named Three In Eleven was said to be 'not hostile'. The sisters still have more than 40 per cent of Billam with Three in Eleven accounting for only 4 per cent.

Shares of the Guinness drinks group, weak recently, livened up as NatWest Securities launched 50 million covered call warrants. The warrants quickly moved to 24p from the 22.5p issue price. They can be exercised from next month until 15 July 1995. The exercise price is 446p for every two warrants. Guinness shares rose 8p to 413p. They have recently been below 400p.

BT, with more than 3 million shareholders and a stock market valuation of pounds 29bn, led shares to yet another peak.

The price rose 8p to a 472p record with the partly-paid up 6.5p to 222p as investors, attracted by the sudden upsurge in activity in the communications industry and BT's possible role as an entertainment provider, sought shares.

BT hopes to emerge as a significant player in the entertainment industry by using its telephone network to supply videos direct to homes. It has estimated that it could generate video revenue of pounds 2bn a year by the end of the decade.

It does, however, face a serious obstacle in the shape of a government block on it entering the home entertainment market before the year 2001. But BT seems prepared to argue that its use of its telephone lines is not covered by the government ban.

The proposed pounds 14.5bn US merger involving Tele-Communications, the largest US cable television operation, and Bell Atlantic, the telephone group, has also had BT shares buzzing. Many believe the British group is in a powerful position to take advantage of the communications revolution.

Comment from Hoare Govett and the introduction this week of a tele warrant basket also kept the BT lines ringing, helping the shares to shrug off rumours of a link between Nynex, the cable group, and Hutchison, the Rabbit mobile telephone operation run from Hong Kong.

But the Nynex talk ruffled Cable and Wireless, down 4p at 948p, and Vodafone, lowered 14.5p to 546p. A Lehman Brothers downgrading was another depressing influence at Vodafone.

The rest of the market was again in buoyant form with the FT-SE 100 share index hitting a 3,156.3 points peak with a 26.7 advance. Trading was busy with hopes of an interest rate cut, reinforced by the gentle downward movement in German rates, inspiring much of the activity. An unexpected strong advance in retail sales was another factor.

Overseas buyers appeared to be back in force seeking blue chips. Private investors made an impact among the fringe shares. Futures activity was another important ingredient.

Imperial Chemical Industries was one to miss the party, down 18p at 709p. James Capel did the damage, repeating its negative view on the stock. Laporte, the chemical group, dropped 11p to 681p as Barclays de Zoete Wedd trimmed next year's forecast by pounds 5m to pounds 120m.

BOC, under pressure because of its US healthcare operations, rose 12p to 671p as some took the view the fall had been overdone and the next set of figures will surprise the pessimists.

Bass, with NatWest Securities adopting a more positive stance, edged forward 5p to 481p but Granada fell 6p to 482p as a US investment house, thought to be Goldman Sachs, hit the shares. Rank Organisation, meeting analysts next week, eased 5p to 813p. Stakis slipped 2p to 62p on a Kleinwort Benson sell recommendation.

On the oil pitch Lasmo created excitement as a variety of rumours wafted around. The shares ended 3.5p down at 137.5p with stories of a boardroom shake-up denied. There was also vague talk of a US investment house turning bearish and that a loan note issue had been pulled. British Petroleum improved 6p to 339.5p as Kleinwort said buy.

The tug over Bowater, the packaging group, saw a victory for the bulls, BZW and SG Warburg, following the UBS hit on Tuesday. The shares rose 9p to 449p.

Virtuality had another strong session, up 21p to 310p. Aegis, the media buyer, fell 11p to 21.5p on the refinancing.

Food retailers, the worst-performing sector this year, perked up a little, with Tesco up 5p to 211p. But Iceland slipped 3p to 190p as a big line of convertible stock and ordinary shares went through at 186p.

Smiths Industries jumped 39p to 394p as analysts upgraded following its results; Rolls-Royce edged ahead 1.5p to 149p.

Betterware, figures next week, moved ahead 4p to 205p and Next, helped by the retail figures, comfortably survived a sell recommendation, up 6p to 195p.

Mulitrust rose 8p to 83p with its warrants up 4p to 20p. The trust, headed by the entrepreneurial investor Andrew Perloff, is in talks that could lead to a big takeover, thereby losing its investment trust status. Ticketing, running ticket agencies, held at 2.25p. A placing of 40 million shares at just over 2p a share raised approaching pounds 800,000, which will help towards acquisitions.

Shaftsbury, the property group, rose 12p to 114p. It has extended its Chinatown estate in the West End of London, buying properties in Shaftesbury Avenue. The cost was pounds 6.4m. Mining & Allied Supplies rose 2p to 23p. There is talk of a Midlands disposal. As well as interests in this country M&A has a quoted Canadian distribution subsidiary.