The stock bucked a rising market and shed nearly 3 per cent as sellers gained the upper hand ahead of tomorrow's third quarter figures.
A minor rebound in the afternoon helped to pare some of the losses, but at the end of the session the luxury hotel group was still 3.5p down to 191.25p.
Well-travelled dealers said they had been ordered by fund managers to pack their bags and leave Hilton because the trading statement to be issued tomorrow will not make pleasant reading.
The stock market appeared to be worried about the performance of Hilton hotels. The whisper is that the chain, which also includes the recently- acquired Stakis, has been given a wide berth by some of its well-heeled guests. The situation appears to be particularly bad in London, where rivals are whispering of a margin squeeze at the top end of the market. The bearish talk over the millennium holiday should also put pressure on earnings. Evidence suggests that travellers have been put off by the inflated prices.
Hilton's other leg, the bookmaker Ladbroke, should have fared better, but with more than half of the profits coming from hotels, the market is bound to focus on the tourism division. The share price is now close to its 12-month low and any further falls could rekindle talk of a merger with Hilton's US namesake or of a break-up of the group.
Hotel and beer group Bass was tarred with the same brush and fell 18.5p to a yearly nadir of 648p, just like rival Whitbread, 5.5p down to 609p. Travel struggler Thomson was hit by similar rumours and nosedived 4p to an all-time low of 86p amid whispers of a major pre-millennium holiday sale.
The rest of the market was sent flying by the strength in heavyweight sectors and a soothing pre-Budget statement by Chancellor Gordon Brown. The FTSE 100 surged 61.2 to 6,435.5 - its highest level in three-and-a- half months - despite an opening tumble on Wall Street, where retail giant Wal-Mart issued a profit warning. Turnover was a hefty 1.6bn as leading institutions returned to the fray.
London's leading equity index was supported by Mr Brown's upwards revision to GDP growth and prediction of a healthy Budget surplus. However, the Chancellor's measures failed to impress the bond market, with gilts finishing lower on profit-taking despite the prospect of a supply squeeze.
The big equity guns were out in force to prop up the FTSE 100. BP Amoco, London's biggest company, soared 30p to 596p after a jump in crude price. Rival Shell was 13p higher to 462p. British Aerospace shot 17.25p higher to 379p after broker DLJ selected it as its top choice among European defence groups with a 547p target.
Banks were also in focus. The latest rumours talked of a tie-up between Alliance & Leicester - 13p better to 910p despite a threat of legal action from ousted boss Peter White - and Abbey National, 19p lower to 1,162p.
Consolidation fever continued to excite drug companies after reports of a merger between Monsanto of the US and Switzerland's Novartis. SmithKline Beecham surged 22p to 890.5p on hopes of a tie-up with Glaxo Wellcome, 8p better at 1,893p. A deal with US rival Bristol Myers Squibb is another possibility.
Building materials group Hanson rose 20p on renewed talk of a merger with Blue Circle, down 3.25p to 313p. Scottish Power rose 8p to 587p on whispers that today's float of its telecom arm Thus will be priced at the top of the 300-325p range.
Retailers were left on the cut-price shelf after a bearish British Retail Consortium survey was compounded by analysts' downgrades. Marks & Spencer shed 5.75p to 277p despite vague bid talk. A downgrade from SG Securities left clothes chain Debenhams 4p lower at an all-time low of 222p, while supermarket Somerfield shed 7.25p to a worst-ever 116.25p after WestLB Panmure slashed forecasts.
Guinness brewer Diageo poured a veiled profit warning and plummeted 34.5p to a 12-month low of 552p, dragging rival Allied Domecq 11.5p down to 315.25p.
The undercard had a good day, with the midcap ending 20.6 up to 5,832.3 and the Small Cap rising 13.9 to 2,719.7.
Market researcher Taylor Nelson jumped 18.5p to a best-ever 212p as a shortage of stock was compounded by bid talk. Whispers of a US bid lifted advertising group Saatchi 15p higher to 304.5p. Bid rumours puffed up cigarette maker Gallaher, 12.5p higher at 377.5p.
Whispers of a bid from Belgian rival and shareholder Brederode sent insurance tiddler SVB Holdings 1.5p up to 113p. Internet yellow pages Scoot.com firmed 0.25p to 46.25p on vague bid talk, while web games developer On-line jumped 37.5p to 170p after placing 650,000 at 130p to boost liquidity.
Biotech group Skyepharma rose 0.5p to 53.75p on rumours that it might appear on Channel 4's "Show Me The Money" programme. Reflective ink group Reflec lost 0.3p to 5.87p after whispers that directors and staff had bought one million shares.
BATM lost 112p to 3,707.5p. After the close it said it would offer 3.3 million new shares to fund acquisitions. AIM-listed driller Independent Energy Holdings fell 7.5p to 1,597.5p despite unveiling a move to the main market next week.
SEAQ VOLUME: 1.55bn
SEAQ TRADES: 97,645
GILTS INDEX: 107.37 -0.45
SILVERMINES, up 0.5p to 33.5p, looks increasingly like a takeover target. The electronic equipment group yesterday saw a big reshuffling in its share register. Shortly after the close, someone bought 5.81m shares - around 6.3 per cent of the company - at 30p. The buyer is rumoured to be electrical engineer TT Group, which already owns about 6 per cent of the company. If the purchase is confirmed, stand by for more bid talk.
THE PRINTING equipment maker Xaar is rumoured to be close to a major breakthrough. Followers of the stock believe that the electronic tiddler is close to complete trials of its ultra-fast print-head. The unique system should enable much quicker printing by boosting printers' workrate. So far, the new print-head has boosted Xaar shares. The price has soared from a low of 51.5p in April to yesterday's 143.5p.