Government stocks put on a positive display with long-dated issues nearly a point higher. The lowest accepted auction price was pounds 94.29, yielding a comfortable 8.53 per cent. The sale was covered 1.96 times.
The shadow of the huge cash call had unsettled the gilts market with some of the uncertanty spilling over to shares. Sentiment was also helped by Robin Leigh-Pemberton, retiring Governor of the Bank of England. He told MPs he expected 'some degree of recovery in the coming months throughout the UK'.
But the market was shocked by the surprise suspension of Queens Moat Houses, the hotel group. Dealings were halted with the shares up 1.5p at 47.5p. Other hotel shares were hit. Forte fell 9p to 192p; Ladbroke Group 4p to 181p; Rank Organisation 8p to 655p and Resort Hotels 2.5p to 39.5p.
Bass, the brewing and hotel group that recently established trading links with QMH, was at one time down 9p but closed 3p higher at 546p. There was some talk of a Bass rescue bid.
Drug shares, for so long under the weather, perked up following a comment from a Clinton aide that it might be difficult to impose stringent controls on prices.
Glaxo Holdings climbed back above 600p, gaining 18p to 606p. SmithKline Beecham, with the added help of an analysts' visit to its US operations, was up 15p to 412p. Wellcome rose 23p to 762p. Medeva gained 6p to 227p. US investors, who have been selling drug shares, are still backing the company with the declared ADR holding up 2.27 per cent to 16.9 per cent.
Imperial Chemical Industries, which has run into trustee problems over its Zeneca demerger, also had to contend with a rumoured profit downgrading. Expectations for this year have been lowered, it appeared, by about pounds 100m to pounds 630m and for next year by pounds 150m to pounds 800m.
Pilkington, however, obtained a boost from a James Capel profit upgrading. The stockbroker lifted its forecast for the year just ended by pounds 4m to pounds 40m and this year by pounds 4m to pounds 60m. But it wondered about a dividend cut - from 6p to 4.5p. The shares rose 3p to 125p.
United Newspapers held at 563p ahead of an investment presentation at Hoare Govett. Abbey National, another involved in US investment activity, rose 4.5p to 384.5p.
JA Devenish, the pubs group, continued its cheerful run, gaining 9p to 302p, highest since 1988. Rumours continue to bubble about a new bid from Boddington Group or the sale of its near-20 per cent interest, a legacy of the last bid.
Scotch whisky shares had another sober session, with Macdonald Martin Distillers serving the latest profit gloom. It suggested profits for the year just ended would be down from pounds 8.6m to pounds 4m. The market expected pounds 5.5m. MMD intends to hold its dividend. The 'A'shares lost 53p to 390p and the 'B' shares, through which the group is controlled, 50p to 600p. Rothmans International, the cigarette group, jumped 38p to 678p, a surprisingly strong response to a reorganisation of its Asian operations.
Lasmo retreated 6.5p to 155.5p following a meeting with analysts and British Petroleum lost some of its recent exuberance, down 7.5p to 303.5p.
But British Gas continued to respond to the Government's coal deal, improving 2p to 316.5p.
Retailers were mixed. Storehouse rose 7p to 198p with Goldman Sachs and SG Warburg making positive noises. House of Lerose, the fashion group, jumped 40p to 186p on the agreed offer from Country Casuals, down 2p at 167p.
Engineer BM Group, following its results, fell 5p to 31p; BBA Group, the motor components manufacturer, was unsettled as a line of stock hovered, seeking a home. The shares fell 3p to 156p and the nil- paid rights 3p to 14p.
Acorn Computer, with investment presentations scheduled for this month, rose 15p to 117p. Avesco continued to reflect its rights issue and proposed VideoLogic demerger, gaining 2p to 100p.
Quality Software, which made a heady debut on Tuesday, ran into profit-taking, falling 17p to 520p. Another Tuesday newcomer, Hambro Investment Services, held at 144p.
The FT-SE 100 index, at one time up 25.3 points, ended 17.7 higher at 2,878.7. The FT-SE 250 rose 11.5 to 3,107.8. Volume reached 821.6 million shares with 43,195 bargains recorded. The Easter account ends on 16 April with settlement expected on 26 April
Pentland, the shoe group, is handing out some of its cash pile. Encouraged by the Budget tax changes it will pay a special interim dividend of 12p a share today, costing pounds 43m. The cash stems from foreign exchange contracts relating to its unsuccessful pursuit of Adidas, the sportswear group. The dividend was announced after the market closed. The shares were unchanged at 124p.
Kewill Systems, a computer group, gained 28p to 142p - making a 68p jump since it sold a loss-making German subsidiary on Monday. The business, Weigang, was unloaded for just DM1. The disposal prompted profit ugradings. Panmure Gordon's Tressan MacCarthy is looking for pounds 2.3m against pounds 2m. In the year just ended Kewill probably made a loss because of the German drag.Reuse content