Then the forex strains gnawed at equity confidence, and by the close the index was nursing a 34.5 fall at 2,337.7.
Fears of higher interest rates and currency upheavals, dulled briefly by last week's ecu loan, were rife. Bleak comments from Fisons and George Wimpey merely piled on the agony and the ecu-inspired gain looks like melting away completely.
The icy blast of crisis, high Scandinavian interest rates and the floating of the Finnish markka created the latest shock waves, leaving the US dollar and sterling again under pressure.
There was no evidence of panic selling. Indeed, trading remained at a low ebb with bargains half the level of the recent past.
Besides the currency turbulence and the disappointing company statements, the market also had to contend with falls in Tokyo and an uninspired New York, in a sombre mood after its Labor Day closure.
Fisons, heavily traded, ended 24p down at 150p and Wimpey 6p off at 71p.
The London migraine symposium failed to lift Glaxo Holdings, down 14p at 750p. Year's results are due tomorrow.
London International Group, hit last week by a failed placing, incurred further difficulties when UBS Phillips & Drew cut this year's profit forecast from pounds 44m to pounds 38m and next year's from pounds 50m to pounds 46m. The shares fell 12p to 161p.
British Steel, down 3p to a 46.5p low, also had a difficult time as analysts cut forecasts and a 10 million block of shares hovered. Carr Kitcat & Aitken has increased its loss forecast from pounds 80m to pounds 150m.
The steelmaker was not the only company influenced by unwanted stock. Overhangs were detected at a dozen blue chips including Legal & General and Guinness.
Barclays de Zoete Wedd added to the discomfort of building materials groups. It has downgraded profit forecasts by an average of 20 per cent this year and 15 per cent next. Redland has been cut from pounds 214m to pounds 198m and pounds 230m to pounds 200m.
Revised estimates also plague the drinks industry. BZW has cut its Whitbread forecasts from pounds 265m to pounds 247m and from pounds 300m to pounds 275m. Henry Cooke Lumsden has trimmed its Greenalls Group estimate by pounds 2.1m to pounds 64.6m.
Whitbread 'A' lost 4p to 396p but Greenalls rose 2p to 319p. Grand Metropolitan, taking analysts to view its Spanish operations, lost 13p to 403p.
Thorn EMI fell 8p to 679p on rumours of a bearish report on its music operations, expanded in April by the pounds 560m takeover of Virgin Music.
Oils tended lower. Lasmo, meeting analysts in the City last night, fell 2p to 126p. It has sold more US operations for dollars 100m.
Vickers lost 10p to 100p, hit by the loss of a potential pounds 1bn Swedish tank order.
But it was not quite all gloom. Boots rose 5p to 458p. Analysts are due to visit its Halfords operation and there is also talk of further licences for Manoplax, its heart drug which last month received approval in Britain.
Asda, the supermarket group, improved 2.5p to 27.5p as Kleinwort Benson and SG Warburg made positive noises ahead of today's shareholders' meeting.
Rolls-Royce improved 3p to 127p following the first order, for dollars 500m, for its BR700 series of engines, developed with BMW.
Rank Organisation, down 14p at 473p, was unsettled by the troubles of Mowat Group, the UK's third-largest holiday camp operator. Mowat shares were suspended at 2.5p. The accountants Touche Ross will move in as receivers today.
Estates & General plunged 8p to 19p. The company later announced a pounds 9.4m loss. Flextech held at 51p as Import & General, a Portuguese company, lifted its stake to 9.86 per cent. Flextech, a media group, is relaxed about I&G, which has said it intends to go to 10 per cent.
The motor dealer Bletchley jumped 20p to 170p following higher profits and dividend and Bimec Industries rose 1.5p to 9p on the sudden departure of its chairman, Sam Smith.
Government stocks and shares weakened again yesterday. Gilts, at one time down pounds 3/4 , ended a fraught session with losses of about pounds 1/4 . The FT- SE share index, up 16.9 points in early trading, ended 34.5 down at 2,337.7. The FT 30-share index was lowered 22.6 to 1,710.6. Turnover was 418.1 million shares, with 15,282 bargains logged
There is talk that Saatchi & Saatchi, the advertising group, is close to launching a third international agency network. The move has been on the cards for some time. It is likely to be centred on the existing KHBB agency as an alternative to Saatchi's two other advertising networks, BSB Dorland and SSAW. Saatchi shares were unchanged at 133p yesterday.
The financier David Rowland and friends have moved in on Teredo Petroleum. The acquisition of a 4.65 per cent stake has lifted their shareholding to 12.68 per cent. Teredo, which has 39 per cent of Britain's first mainland oilfield, Humbly Grove in Hampshire, is seeking a meeting with the Rowland contingent to discover its intentions. The shares held at 9p.
Winterflood Securities and Bikuben Whitefriars may be moving to plug the market-making gap left by SG Warburg. The two firms have had many inquiries from the ranks of the 362 companies threatened with relegation to the bulletin board since Warburg dropped them from its market-making book. Decisions are expected before the account ends next week.
- More about:
- American Dollar
- Loans And Lending Market
- London Metropolitan University
- Saatchi & Saatchi