The stock yesterday was hit by the market's sickness and lost 27p to 1591p, but a small band of dealers believes that a confidence-boosting announcement is around the corner.
They are hooked on the idea that the drugs group is about to announce a major shake-up of its manufacturing facilities, which could lead to hefty cost-cutting and boost its bottom line.
According to the whispers, Glaxo has completed a wide-ranging review of the operations and has concluded that some of its drug-making plants must close. The move could affect some of Glaxo's eight UK plants and lead to job losses among the company's 8,000-strong British workforce.
However, politically-savvy traders said that the company may decide not to ruffle the government's feathers with domestic redundancies and close some of its overseas plants. The company has more than 40 plants in 30 countries and picking a less politically-fraught place should not be difficult.
Wherever the closures, the mooted restructuring should please the City. The Square Mile loves rationalisation and cost-cutting and would welcome a radical move shortly after Glaxo's disappointing results, which reawakened talk of a merger with SmithKline Beecham, 5.5p lower to 750.5p.
The feeling in the market is that the drug company will not meet its self-imposed growth targets and any effort to reduce costs would be praised.
On the products' front, industry experts expect some fresh news on Glaxo's flu drug Relenza at a pharma conference in San Francisco this weekend. An update on its HIV portfolio could also be around the corner.
The rest of the market was in poor health and closed lower once again. The FTSE 100 fell 43.4 to 5,913.9 as fears of a US rate hike continued to dampen sentiment.
The minutes of the latest Bank of England meeting had little impact as the London spotlight was firmly trained on the falling Wall Street. The Dow killed off any hopes of a UK rally with another nervy start and compounded the misery with a 100-point tumble by the London close.
The smaller indexes did even worse. The mid-cap lost more than 1 per cent, or 64.6 points, to 5,722.8, while the Small Cap shed 36.6 points to 2,711.1.
This general debacle came despite the re-run of some juicy bid rumours among blue chips. Electricity generator National Power buzzed 14.5p higher to 477p on good volume amid revived talk of a 600p-per-share takeover or a sale of its international operations. Possible bidders include Germany's RWE, Electricite' de France and the US giants Duke Energy and AES.
The whispers of a bid for Bank of Scotland, 16p higher to 695.5p, were still around. Lloyds TSB, up 5p to 750.5p, is still favourite, but alternative rumours pointed to Halifax, 10.5p higher at 694.5p, or even Royal Bank of Scotland, down 12p to 1142p.
Less excitable dealers explained the BoS rise as buying ahead of next week's results or in anticipation of a bid for the small Irish bank ICC.
Mining stocks were as good as gold as rising commodity prices unearthed some buyers. Anglo American benefited from a rare spike in the gold price and rose 103p to 3,179p. Rio Tinto, 17p higher to 1,057p, had the additional boost of an upgrade from influential broker CIBC, while Billiton climbed 4.75p to 244.5p, despite a CIBC downgrade.
Oils were mixed on the first day of the Opec meeting. Midcapper Lasmo rose 5.75p to 146.75p on whispers of interest from Italian oil giant ENI, once rumoured to have had a look at Enterprise Oil, 10p better at 445.75p.
Among the majors BP Amoco firmed 4p to 1,093p after a CSFB push but Shell dropped 3.5p to 463p on profit-taking. Insurers Royal & Sun, 7.5p better at 464p, and Prudential, 3p higher to 901p, were boosted by a sector upgrade from Salomon Smith Barney.
Lemsip maker Reckitt & Colman surged 13.5p to 770.5p on returning whispers that its takeover of Dutch rival Benckiser could be soon be approved by the US regulator.
Retailer GUS crashed 43.5p to a five-year low of 488.5p after Merrill Lynch slashed 1999 forecasts by 8 per cent. The broker is concerned at the sales slowdown in GUS' mail order business.
Smaller rival N Brown shed 27.5p to 307.5p. Marks & Spencer dropped 15.5p to another five-year low of 312.25p after super bear WestLB Panmure downgraded again.
Doubts over the takeover of Legal & General, 1.25p lower at 189.75p, sent NatWest 15p lower to 1,037p. The bank is also targeted by an arbitrage play of selling NatWest and buying L&G.
Gas group BG plunged 19.75p to 351.75p as a big seller dumped a line of stock and amid vague talk of a regulatory squeeze. The arrival of another lawsuit from the US government dragged tobacco group BAT 25p lower to 478p.
Old bid chestnut Pilkington firmed 1.25p to 108.75p on an intriguing rumour that the people connected with French glassmaker Saint Gobain are buying stakes ahead of a bid for the UK group.
The overnight profit-warning from US giant Apple Computers unsettled Computacentre, 18.5p down to 606.5p, and IT group Admiral, 32.5p lower to 845p.
The venture capitalist tiddler Foresight soared 60 per cent, or 75p, to a record 200p on whispers that it has invested in a soon-to-be-floated Internet company.
Racecourse owner Arena Leisure galloped 10p higher to a peak of 52p on whispers of an approach by bookmaker Victor Chandler or even the Hilton, 6p lower to 205.25p, the owner of Ladbroke.
Oil minnow Pan Andean confirmed talks to drill in Bolivia and rose 2.75p to a record 24.25p.
Engineer TransTec plunged 6p to 17.5p after an interim loss, while financial services minnow Garban-Intercapital lost 32.5p to 222.5p on a veiled profit warning.
SEAQ VOLUME: 1.18BN
SEAQ TRADES: 82,694
GILTS INDEX: 103.03 -0.42
STAND BY for more disposals from Cortecs, 1p lower at 14p. The biotech group is trying to forget recent problems with drugs and management by selling off non-core businesses. That process could soon be completed with the disposal of its sales subsidiary. The division should be sold to a small pharmaceutical company before Cortecs' finals in late October. The deal should bring total proceeds from the disposal programme to over pounds 4m.
THE COMPUTER minnow Tadpole Technology firmed 0.75p to 17.75p yesterday on talk of a deal with a major blue-chip company. Punters are muttering that the maker of computer hardware has won a contract to supply a large telecoms group with its lap-tops.
The portable computers are designed to help travelling engineers to link- up with their headquarters and could be extremely useful for a company such as BT.Reuse content