But after the first minute of trading Footsie stuck in negative territory. By the close it was down 55.6 points at 5,077.5, despite continuing progress on Wall Street.
Downbeat futures contributed to the lacklustre performance. So did worries that, perhaps, the Monetary Policy Committee may not follow the US example and cut interest rates again. Hopes of a special "wise persons" meeting being called are not high and there are fears that a standstill decision will be the result of next month's regular review.
To add to the uncertainty, worries persist that last week's surprise US reduction may indicate the American economy is in a rather more fragile state than suspected.
Supporting shares failed to offer much encouragement. The mid cap index managed a 9.9 gain to 4,573.8 and the small cap added 10 to 1,921.3.
Even good old-fashioned takeover yarns failed to have any impact. According to Credit Lyonnais, the US retailing giant Wal-Mart is planning a European assault and Asda and Wm Morrison are likely to be in the front line. Asda dropped 8p to 157p, lowest for nearly a year, and Morrison managed to stir itself into making a 0.5p advance to 276p.
CL's Paul Smiddy and Christain Guyot have raised their Asda recommendation because of the possibility of a pounds 5bn bid from the world's biggest retailer. They say Asda shares "remain a sell on fundamentals but are a worthwhile add for special situation funds".
J Sainsbury was another in the takeover spotlight. Weekend stories suggested a merger with Royal Ahold, the Netherlands chain. Sainsbury described the whole idea as "pure speculation," which did not prevent the shares gaining 11p to 574p.
BOC, the chemical group, added 15p to 730p as Morgan Stanley adopted a more cautious stance. Imperial Chemical Industries was another feeling the analytical pinch - this time from Sutherlands. The stockbroker expects third-quarter profits of pounds 62m on Thursday (against pounds 132m) and has reduced its year's forecast to pounds 296m. It has also taken the axe to next year's estimate, chopping from pounds 350m to pounds 295m.
Banks failed to draw much strength from takeover talk from Sir Brian Pitman, chairman of cash-rich Lloyds TSB. Discussing corporate activity in the financial sector, he said market volatility will provide more opportunities for bids and deals. "The options are greater now than they were a few months ago," he told a retail banking conference.
He added: "The gap between winners and losers has accelerated in the past few months and shake-out like this give rise to golden opportunities."
Lloyds, which has made no secret of its predatory ambitions, fell 13p to 727p but Barclays firmed 20p to 11,50p. Halifax, said to be seeking a healthcare acquisition, fell 12p to 775p.
Corporate action bubbled on the under card. Clyde Blowers, an engineer, jumped 77.5p to 137.5p after it revealed an approach at 165p; W Canning was another celebrating bid feelers, up 74p at 228.5p.
Hard-pressed Tie Rack confirmed approaches from Sock Shop. Indeed it complained it had "been pestered for some time" but was not interested in a deal which would, in effect, amount to Tie Rack buying the sock retailer. The shares added 5p at 28.5p.
Weir, the engineer, gained 21.5p to 225p on suggestions of bid interest, and Tarmac, up 6.5p to 101p, was said to be planning a three-way deal which would bring Amec into the deliberations already going on with Aggregate Industries.
Sedgwick, the insurance broker, put on 15p to 213p after Westminster cleared the bid from US giant Marsh & McLennan. Regulatory approval for the Victoria Wine-Threshers off-licence merger left the respective owners Allied Domecq a shade lower at 475p and Whitbread 26p off at 773p. Another deal given Westminster sanction was the merger of Alvis, the military vehicle group, with GKN's defence side. Alvis reversed 2.5p to 176.5p.
De La Rue, the security printer, hardened 4p to 186.5p on rumours of a Microsoft strike. The company said it had not had a formal approach.
Next, the fashion chain, was cut 13.75p to 461.25p after Tiger Management, the hedge fund which had been a persisted buyer of its shares, sold 4.35 million, reducing its stake to 10.99 per cent.
The day's worst display came from Brooke Industrial, an engineer. The shares plunged 40 per cent to 73.5p after it revealed takeover talks were off and profits would be below expectations.
SEAQ VOLUME: 768.4m
SEAQ TRADES: 57,104
GILT INDEX: 110.88 -0.47
THERE SEEMS to be a deep transatlantic fascination for Wace, the struggling printer. Chicago-based Huntingdon Partners and one Samuel H Ellis have acquired 8.6 million shares and now have 20.5 per cent. Most of the shares appear to come from Franklin Resources, a US group, which sold 9.9 per cent. Huntingdon and friends have been keen buyers this year; Wace, now 26p, was 40p in April.
OLD MONK Co, a pubs chain, has braved the turbulent stock market and dealings should start today. The company sold shares at 60p. Stockbroker Beeson Gregory managed to place just under 1.5 million, although non-executive director Ray Martin helped things along by subscribing for 266,000. Old Monk, created by Gerry Martin (whose brother, Tim, runs JD Wetherspoon) has 18 managed pubs. Profits in its last year were pounds 488,000.Reuse content