Market Report: Presentation excitement provokes a gush over Shell

Shell surged to a high as the stock market grew excited about an investment presentation due to be held in London today. The shares flared 25p to 939p, encouraged by the view that the oil giant would not bother to meet analysts unless it had an encouraging story to tell.

Guessing just what could be on the Shell agenda produced two main possibilities - a major oil discovery and a move to slim the heavyweight share price through a split or bonus issue.

There has for some time been speculation Shell has made a rich find off the coast of Peru. With South America emerging as the continent for spectacular oil and gas discoveries - Bolivia and Colombia - Shell's off-shore venture has been attracting considerable attention.

Just to add to the air of expectancy there was also a rather ill-defined rumour that Shell could be contemplating a break-up exercise.

With a positive trading note struck at yesterday's shareholders' meeting the market not only busily chased Shell but alighted on other oil leaders.

British Petroleum added 12.5p to 579.5p and Enterprise Oil, enjoying vague stories about a strike off the Irish coast, 14p to 473p. Lasmo rose 2.5p to 188p.

Lucas Industries remained in the spotlight as stories continued to flow that its deal with Varity of the US was about to be announced. With Mannesman, the German group, said to be hovering with a counter-strike, the shares gained 2p to 233p.

P&O had a sluggish time, slipping 2p to 518p. An investment meeting failed to produce much inspiration and a 4.9 million share deal at 508p, reputedly by Merrill Lynch, ensured a flat performance.

The market managed another upbeat display, with the FT-SE 100 index climbing 16.5 points to 3,776.2, although supporting shares, as measured by the FT-SE 250 index, had another unsure session with the record-breaking days of March and April reduced to a distant memory.

Labour's renewed threat to introduce a windfall tax on utilities heaped more agony on the sector, eliminating any joy from the PowerGen share buy-back and dividend rise.

Yorkshire Electricity fell 18p to 744p and London Electricity 12p to 740p. National Power dropped 7p to 520p and PG 10p to 537p.

BT managed to resist the trend, gaining 7.5p to 334.5p. Figures are due today and there are hopes that they will be accompanied by details of a share buy-back. Cable and Wireless greeted the appointment of its long- awaited chief executive, Richard Brown from CompuServe, with a 5p fall to 464p.

The much-rumoured bank deal failed to materialise although there is a growing conviction further action in banking, or at least the financial sector, is about to re-emerge. The only banking development was a recommended switch from undervalued to hold by ABN Amro Hoare Govett which helped produce a few gains. Perpetual, on old take-over candidate, jumped 100p to 2,458p on another set of sparkling results.

Amstrad's latest setback - at Dancall, its telecom subsidiary - left the shares 32.5p lower at 173.5p. Courtaulds, up 16p to 427p was lifted by a Barclays de Zoete Wedd buy note and Tesco was helped by Merrill support, up 2p at 288p. Asda, in heavy trading, rose a further 0.75p to 118.5p.

Appleyard, the garage chain, shaded to 105p despite busy trading, with a 3.5 million agency cross going through at 99p. Inchcape appears to be the rumoured predator.

Smith & Nephew's strong run ended with a 4p fall to 205.5p. Societe Generale Strauss Turnbull suggested the health group's shares had reached "more appropriate levels". Celltech rose 38p to 637p following indications it could have two drugs on the market next year.

De La Rue rose 12p to 743p; an associate has been awarded the contract for the automation of benefit payments and post offices.

Caldwell Investments, the textile group, gained 2p to 48p and Tadpole Technology, following lower losses, rose 6p to 59p.

Century Inns, which came to market at 120p in December, was firm at 138p. UBS placed 17 per cent of the capital at 133p with 14 institutions. The shares came from a Schroders venture capital fund, the pub company's original backer.

Newcomer PGA European Tour Courses, a golf group created out of the Union property operation, returned at 10p but shaded to 9p in heavy trading with Seaq putting volume at 32 million.

TAKING STOCK

UBS has placed the 23.6 million shares in Eurodis Electron unloaded by Swiss group, Elektrowatt. They were yesterday spread among 50 institutions at 220p. The shares rose 4p to 230p. The Swiss made clear their intention to sell their 40 per cent interest in January. They had hoped to sell to another group, thereby triggering a takeover bid.

There was talk of a 360p a share deal. But in the event the shares went to UBS with instructions to place them in the market.

Rutherford Asset Management, controlled by Sir Peter Michael, has acquired CW Asset Management, manager of Eaglet Investment Trust. The cost is around pounds 500,000. With other small company funds, such as Pilot and Beacon, Rutherford is now the biggest single investor in the AIM and Ofex markets.