The shares reversed 32p to 1,432p although some other transport stocks edged ahead.
The rail group is going through a distinctly unhappy patch. It is still feeling the strain from last week's ambitious pounds 400m bond issue and has also had to contend with regulatory hints of a profits cap, which could wipe pounds 100m from its figures. In the current tender atmosphere the market is highly sensitive to any possibility of more restrictions being aired.
Mr Prescott is expected to attempt to generate some favourable headlines by lashing the industry and Railtrack cannot hope to escape the strictures.
Although the summit is said to be aimed at trying to move the rail industry forward, rather than dwelling on the hideous past, it is widely believed the privatised companies will eventually face further restraints which could undermine their appeal to investors.
Last year Railtrack was riding at a 1,687p peak. The shares were 380p just after their 1996 flotation.
The rest of the market experienced a largely lethargic session with takeover speculation preventing it from sinking into a self-imposed stupor.
Although by past standards share turnover was strong, it fell below recent levels which provided traders with their busiest ever run.
Footsie, encouraged by New York, ended 38.7 points higher at 6,069.9. At one time it was off 36.4. Supporting shares moved ahead.
Rank, the leisure group, was one caught up in bid speculation. More stories of a break up strike left the shares 12.25p higher at 235p.
Engineer Weir, which rejected bid approach, gained 10.5p to 265p on talk of a US hit and Williams, the security group, was at one time 12.5p higher at 370p on reports of trans-Atlantic interest. The shares ended 2.75p lower at 355.5p with a positive Australian visit seemingly making little impression.
Hornby, the toys group, rose 12.5p to 245p on rumoured bid interest and Queens Moat Houses, the hotel chain, added 2.25p to 24.25p on suggestions of a break offer from a venture capitalist.
Retailer Laura Ashley firmed 1.25p to 19.5p on reports that its Malaysian shareholders intended to take it private. Hard-pressed AB Airlines said it was in talks although a bid had not materialised and the shares fell 1p to 33.5p. London International Group, where takeover talks are on, improved 7p to 163p.
BICC, the cable and construction group which is in the bid frame, hardened 2p to 80p. Thoughts of corporate action were, for once, unlikely to be responsible - a share in a pounds 200m Railtrack contract almost certainly provided the spur.
Greenalls, the hotels and pubs chain which could probably claim to be the most bewhiskered take-over candidate in the market, fell 8p to 372p, despite suggestions of Scottish & Newcastle attention. A week ago Whitbread was said to be the party hovering. HSBC and SG Securities were less than enthusiastic about the shares with HSBC bluntly saying sell.
Despite the flowing speculation there was not much real bid activity, merely a deal by Falcon. The small distributor of pipeline equipment jumped 43p to 180p after disclosing it was in talks to sell much of its business to the French giant, Saint-Gobain.
Fortnum & Mason, the Piccadilly store controlled by the Weston family of Associated British Foods fame, was the day's outstanding performer, surging 170 per cent to 432p. The shares are an exceedingly narrow market and the excitement was in fact an illusion as a Friday miscue was corrected.
BT gave up 21p to 1,051.5p, largely on worries it might intervene in the Olivetti bid for Telecom Italia. Cable & Wireless, little changed at 851.5p, could also be tempted into the fray.
Unilever gained 42p to 625.5p on suggestions that its results could be accompanied by details of an up to pounds 2bn share buyback. Ladbroke firmed 7.25p to 270.25p on the William Hill fiasco.
British Aerospace recovered some of the altitude surrendered last week on worries about its Saudi Arabia contracts with a 19p climb to 421p. The successful Air France flotation lifted British Airways 15.5p to 457.5p.
Compass, the contract caterer, had a lean time, at one point falling 37.5p. It closed at 696.5p, off 19p. Merrill Lynch did the damage, reducing its rating. The shares are also coming under pressure because Accor, the French group rumoured to be one of those interested in Vaux's Swallow hotel chain, is now free to sell its 4.9 per cent shareholding.
Reuters, the information group, logged off 6p at 867p ahead of a Henderson Crosthwaite investment dinner at London's Savoy Hotel.
Supermarket chains were in the doldrums on the latest price war. Tesco fell 2.5p to 173p; J Sainsbury 7.75p to 258.5p and Asda 3p to 149p.
Smaller oil shares weakened with Schroders suggesting the crude oil price could slip to $8 barrel if OPEC fails, as many expect, to cut quotas next month.
With talk circulating that their proposed defensive merger is likely to be abandoned, Enterprise Oil lost 3.25p to 238.75p and Lasmo 1.5p to 110.5p. BG, reporting today, is thought in some quarters to be willing to barge into the deal with an offer for one of the two would-be merger partners. The shares gained 7.25p to 361.5p.
Ulster TV brightened 28p to 220p following its pounds 18.4m (35p a share) special dividend.
Futures Integrated Telecoms improved 5p to 45p. Its founders Kevin Clarke and Garry Allsop have sold shares and now own 15.85 per cent and 16.8 per cent respectively. Investment meetings helped smooth the sale.
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