Indeed, the advance was deceptive. It was almost entirely the result of a market-makers' mark-up. There was little buying, and when sellers attempted to take advantage of the inflated prices the gains were quickly adjusted.
It was the last day of what has been a volatile account, and with New York weak, following poor US trade figures, few investors were inclined to take new positions.
Their reluctance was compounded by worries over sterling, the coal crisis and the continuing impact of the recession. The interest cut had clearly been factored into the market and the upsurge reflected market-makers attempting to keep books level ahead of the weekend.
Although the FT-SE 100 has swung sharply in the account, the change over the two weeks was marginal - a 14.2-point gain.
The market also had to contend with the nagging thought that it was the fifth anniversary of the start of the crash of 1987. In a few weeks the FT-SE 100 slumped by more than 700 points.
Interest-sensitive shares, of course, were the main beneficiaries of the cut to 8 per cent. Building and building material shares held on to much of their advance; so did some drink and retailing issues.
The prospect of lower mortgage rates helped the composite insurers with mortgage indemnity exposure. Commercial Union led the advance, up 17p to 536p. Royal Insurance rose 8p to 180p. But Guinness missed out, down 15p to 527p. SG Warburg caution did the damage.
Imperial Chemical Industries was another out of fashion. Smith New Court lowered its profit forecast for next year from pounds 825m to pounds 770m. The shares dropped 25p to 1,027p. Nine- month profits are due in the next account. They are expected to show a 25 per cent fall to pounds 525m.
Water shares flowed strongly as the market took the view that the latest Ofwat curbs were comfortable.
Double-figure gains occurred throughout the list with new peaks hit. Thames Water jumped 20p to 460p and Welsh Water 16p to 477p. North West Water, resisting the Ofwat demands, gushed 15p higher to 442p.
County NatWest believes NWW has a 'strong case given substantial incremental legal obligations'.
Ranks Hovis McDougall's plan to slice itself into three to defeat the hostile bidder Hanson pushed the shares 5p higher to 246p. An improved Hanson offer is thought likely. Hanson gained 3p to 219p. Dalgety, buying baking and milling operations from RHM, rose 9p to 431p.
Siebe, the engineer, lost 6p to 314p. There have been indications this week that a large line of stock was on offer and County placed 2.75 million shares at 307p. The stock was placed among several institutions.
British Petroleum, up 3.5p to 222.5p, reflected positive comments from Carr Kitcat & Aitken. On the other hand, Burmah Castrol eased 14p to 618p on a downgrading, thought to be from Smith.
Barclays, the banking group, had a difficult session, falling 21p to 317p. Worries about the impact of the group's property exposure and the likely level of bad debts continue to weigh on the shares. Credit Lyonnais Laing is known to be bearish and has suggested the dividend should be trimmed.
Standard Chartered was up 15p at 505p. It was disclosed that Barclays has a near 3 per cent stake.
Wellcome put on 18p to 949p. Lehman Brothers upgraded its profit expectations.
Thames Television, after its progress this week, ran into profit-taking, falling 12p to 169p.
The brewer Morland held at 365p. Warburg, on behalf of the Whitbread Investment Co, placed 620,000 shares, reducing the WIC interest to 12 per cent. The stock was placed at 350p. Hoskins Brewery held at 46p as the rebel shareholder Richard Cattermole lifted his stake to 5.07 per cent. He has demanded a shareholders' meeting at which he will propose board changes.
Haemocell, which has won US approval for its blood filtration machine, jumped 26p to 210p as stories circulated that Stryker, a US group involved in the distribution of Haemocell's invention, was planning to mount a takeover bid. A price of 350p a share was suggested.
ML Laboratories improved a further 15p to 853p on hopes that its kidney dialysis drug is about to get UK approval.
Dealings in the shares of Vardon, the leisure group being created by David Hudd and Nicholas Irens, are due to start on Monday. There will be four market makers. The shares have been traded under the 535 rule facility with a price of 52.5p indicated. The company, taking in the London and York Dungeon waxwork displays, paid pounds 9.9m for Sea Life Centres.
Volex, the electrical group, is continuing its bid to become an international player, by paying pounds 6.5m for 60 per cent of a Singapore group making data and power cord operations. Much of the cash has been raised through a share placing by SG Warburg at 275p a share. Volex, which forecast interim profits of pounds 2.8m ( pounds 1.5m) and a unchanged 6.5p dividend, rose 8p to 294p.Reuse content