Market report: Flight to quality sends blue chips soaring
Saturday 17 January 1998
With Asian markets looking stronger, New York putting on a positive show and the monthly futures expiry going so smoothly it was almost unnoticed the stock market was confident and relaxed.
The so called "flight to quality", prompted by Asian alarms, has directed even more attention on blue chips, particularly those with little, if any, Asian exposure.
In busy trading Footsie surged 111.0 points to 5,277.2, its first century for five weeks. At the close the score had been trimmed to 97.3 at 5,263.1.
Vodafone, reflecting a mixture of trading and take over hopes, led the blue chip charge with a 34p jump to 483p. But it was a pitiful time for the constituents of the FTSE 250 index.
The blame for their lacklustre performance was laid, rightly or wrongly, at the door of the market makers of BZW.
They had been told to end the week, it was alleged, with balanced books and found themselves forced to cut some of their positions.
With BZW. now part of Credit Suisse First Boston and suffering the indignity of redundancies, such manoeuvres are distinctly possible.
Groups with extensive Far Eastern exposures also missed the party. Rolls- Royce dived 7.5p to 206p and British Aerospace was lowered 11p to 1,605p. BTR found yet another new low, off 5.75p to 160p and engineer Siebe gave up 47p to 1,047p.
Retailers had a mixed time with Argos registering disappointment with its festive display, falling 63p to 442p, lowest for two years.
Laura Ashley's ragged decline continued, down 6p to 20p. In the summer of 1996 the price touched 219p as hopes bloomed that new chief executive Ann Iverson would restore the group's fortunes. She left the company in November.
Said one dealer: "Investors are bailing out while the company is still in business". Dixons remained depressed on its sales misadventure, falling a further 7p to 498p. The shares have lost 84p since Wednesday's downbeat comments.
Supermarkets had another eventful session with Asda jumping 8p to 195p in heavy trading. Take over rumours continued to swirl but the activity could have been due to the futures expiry. There was also talk of US buying interest.
Safeway, Asda's suspected target, added 11.25p to 366p and Tesco hardened 11p to 512p. On Monday it will become the first major supermarket chain to pronounce on Christmas trading.
The fledgling IT sector had another rip roaring session as fund managers were forced to increase their exposure. Logica jumped 77.5 to a 1,287.5p peak and Sage 35p to 952.5p.
Disappointing figures from City Centre Restaurants took a 15.5p bite out of the shares at 117.5p.
WPP, the advertising group, responded to a Merrill Lynch upgrading with a 9p advance to 252p.
Rentokil Initial, the environmental and property services group, hardened 9.5p to 295p as Sophus Berendsen, the Danish company which once had a controlling stake, split itself into two. SB retains the trading activities, ranging from electronics to textile services, and 3.6 per cent of Rentokil. A new company, Ratin, which like SB will be quoted on the Copenhagen stock market, will hold 32.2 per cent of Rentokil. Fears have been expressed that the new Danish company could make Rentokil vulnerable if a hostile take over strike emerged.
On the take over front Sibir Energy improved 3.5p to 44p as Pentex, which has 40 per cent, opened bid talks with the Siberian oil explorer because it has "become apparent to the management that the two companies would need to be merged". Pentex floated Sibir last year.
Manchester Utd. was the subject of heavy turnover with the shares closing a little firmer at 158p. Volume was nearly 17 million with some chunky lines going through at around 155p.
BTG, the old British Technology Group which is working on a multitude of developments and inventions, including a revolutionary gearbox, jumped 40p to 722.5p ahead of a rumoured investment reception last night for the group's major investors.
The day's biggest casualty was Compagnie de Participations Financieres, a Luxembourg registered company operating in the German property industry. One of the more obscure AIM shares, it slumped 190p to 307.5p after a bitter dispute between the board and the company's main shareholder came into the open. Two directors have quit and the rest will depart after a shareholders meeting next month. It came to AIM just over a year ago.
- 1 Paul Scholes: Manchester City were so good against Liverpool I felt like turning the television off
- 2 Notting Hill Carnival: Woman shares selfie after being ‘punched in face for telling man to stop groping her’
- 3 Pamela Anderson rejects ice bucket challenge because of ALS experiments on animals: 'Mice had holes drilled into their skulls'
- 4 Homer Simpson takes the ALS ice bucket challenge because of course he does
- 5 Hello Kitty is not a cat after all
America’s new apartheid: Prosperous white districts are choosing to break away from black cities and go it alone
Arizona shooting: Gun instructor accidentally killed by nine-year-old girl with Uzi
YouTube video posted by Isis militants shows 'execution of 250 Syrian soldiers'
Notting Hill Carnival: Woman shares selfie after being ‘punched in face for telling man to stop groping her’
Hello Kitty is not a cat after all
Exclusive: We share blame for creating 'jihad generation', says Muslim strategist
Robin Williams Emmys tribute led by Billy Crystal criticised for including 'racist' joke about Muslim woman
The Rotherham child abuse scandal is a tale of apologists, misogyny and double standards
Scottish independence TV debate: Pumped-up Alex Salmond bounces back in bruising second round against Alistair Darling
Do you realise just how foolish the UK looks?
Ukip Douglas Carswell defection: Tory MP jumps ship to join Nigel Farage
- < Previous
- Next >
iJobs Money & Business
Highly Competitive Salary: Austen Lloyd: CITY - An excellent new instruction w...
£500 per day: Harrington Starr: SQL Server Developer SQL, PHP, C#, Real Time,...
£600 per day: Harrington Starr: C#.NET Developer C#, Win Forms, WPF, WCF, MVVM...