Suddenly the market decided to fret about the Japanese earthquake disaster. It worried about the possibility of Japanese funds being repatriated and the subsequent impact on world bond prices. The dramatic slides in the Tokyo and Hong Kong share markets were seen as warnings not to be ignored.
With the perennial bugbear of higher interest rates still tormenting sentiment and New York turning in yet another poor display the spectacular Glaxo bid and appreciation of the expected spin-offs were swamped by the morose atmosphere.
Shares could, if the futures market is any guide, fall further today. Unless there is a sharp change in sentiment the FT-SE 100 index could soon fall below 2,900, it is feared.
Yet for the past few months the market has clung desperately to takeover hopes, suspecting a mighty deal was being prepared. The familiar cry has been that it would require just one big, glamorous takeover bid to put shares on a more even footing.
The Glaxo bid should have met the market's wildest desires. Besides being the most manifest indication of wide-ranging corporate activitity since the £3.7bn HSBC offer for Midland it offers the tantalising prospect of much of the takeover cash being quickly reinvested.
The Wellcome Trust, if it follows past practice, will move quickly to return the cash element of the offer to the market. Wellcome's host of institutional shareholders are likely to adopt the same policy.
Turnover was far from excitling. But there was chunky business, in the likes of Wellcome, which means securities houses should, for once, have earned realistic commissions.
Wellcome surged 273p to 961p, with Seaq putting turnover at almost 51 million; Glaxo slumped 44.5p to 599p, with more than 30 million shares printed.
The excitement spilled over to Zeneca, up 24p to 916p with turnover put at nearly 10 million. Even bewhiskered bid candidate Fisons managed a 2.5p gain to 108p with 3 million shares printed. There was talk of an instruments disposal in a few weeks Cadbury-Schweppes added to the takeover excitement. It appears at last on the brink of agreeing the takeover of Dr Pepper/Seven-Up, the US soft drinks gorup where it has a 25.3 per cent stake. A deal could cost £1bn and involve a rights issue of up to £500m. Cadbury shares fell 12p to 389p.
Another acquisition involved Forte, down 8p to 230p. It is selling its 24 per of caterer Gardner Merchant for £140m to French group, Sodexho.
The outbreak of coporate action also engulfed SG Warburg where rumours of a deal at one time lifted the shares 33p; they closed 5p higher at 736p.
Away from the takeover excitement the market was back to the nitty gritty of stockbroker recommendations. Kleinwort Benson hit Granada, down 9p to 485p, by suggesting Forte, Ladbroke and Rank Organisation were better value.
Rank, with Hoare Govett suggesting the shares should be sold, lost 7p to 375p.
Prudential fell 4p to 309p. After the market closed came the surprise departure of chief executive Mick Newmarch. The shares are expected to fall further today.
Cable and Wireless, down 15p to 354p, was hit by Kleinwort caution and the decline in the Hong Hong market. HSBC was another hit by the Far Eastern weakness, off 36p at 589p. Standard Chartered also suffered, down, 8p at 247p.
The possible implications of the Japanese earthquake repair bill also sent tremors throught the normally sedate investment trust world.
Groups with Japanese associations were mauled as the uncertainty about the funding of the restoration programme caused widespread confusion.
Baille Gifford Japan fell 39p to 586p; Fleming Far East 16p to 279p and Govett Oriental 17p to 324p. Pacific Assets finished 27p lower at 362p.
Helene, the clothing group, was ruffled by stories of management problems, down 4p at 21.5p. Worries about the growing competition from Cellnet sent Vodafone down a further 3p to 184.5p.
Taylor Woodrow, the builder, suspended its share buy-back with 33.6 million under its belt. Ithas approval to buy a further 2 per cent. The shares shaded 1p to 124p.
Water Hall, the old Starmin quarrying group which returned to market last week following a rescue reconstruction exercise, has attracted at least one new stakeholder. Allied Financial Securities, the stockbroking group, has acquired almost 30 million shares, representing just over 4 per cent of the capital. The shares were unmoved - at just 0.75p, pricing the group at £6m.
Robert H Lowe, the labels, packaging and sportswear group back in the black after five years in the red, should make further progress, the stockbroker Greig Middleton believes. The analyst Alison Rennie is looking for £1.15m this year and £1.35m next. Andrew Dalton, ex Sidlaw, has been recruited to spearhead a search for packaging acquisitions. Ms Rennie regards the shares, 11.5p, a buy.
The FT-SE 100 slumped 40.8 points to 2,954.2 and the FT-SE 250 fell 40.3 to 3,384.3. Turnover was 687.6 million shares with 23,987 bargains. Government stocks fell by more than £1/2.Reuse content