Market Report: Shares taken to record by new indices

SHARES stretched to a record high yesterday as the Christmas trading account, after a sluggish start, made its traditional acknowledgement of the festive spirit.

It was not, however, the widely followed FT-SE 100 index that measured shares into new, uncharted territory, although it romped ahead 49.4 points to 2,789.7. The records were achieved by the two indices introduced in October to provide a much broader reflection of the stock market's performance.

The FT-SE 350 index, measuring the top 100 shares and the next 250, jumped 24.7 to 1,358.7, comfortably topping the 1,345.5 hit at the start of this month. The other new index, covering the second-line 250 shares, reached 2,783.6, highest since it was launched. However, it just failed to overcome a backdated calculation that produced a Maytime peak.

The euphoria, which added pounds 10.8bn to the market's value, was helped along by unexpectedly optimistic noises from the Confederation of British Industry, vague talk of lower interest rates and a firm New York opening.

A few institutional investors were detected switching out of blue chips into second-line recovery stocks, and that once-endangered species, the private investor, was alive and well and seeking out his 1993 selections. There was also a sign that some institutions, fearful of missing the Christmas rally, were protecting their positions towards the close.

But technical influences loomed large, with the futures market once again having a significant impact. Yesterday's expiry of the Footsie futures index, which had at one time created worries that stock would come on offer, went smoothly and, in the event, left market makers short of stock.

Turnover reached 939.5 million shares, highest since the sterling devaluation in September. In two days volume has topped 1.7 billion shares, which must have reduced the threat of redundancy at many investment houses.

Many expect shares to continue to advance next year as the longed-for economic recovery at last starts to come through. Nikko, the Japanese investment house, looks for the FT-SE 100 to hit 3,000 by the end of the year; Kleinwort Benson is a shade more optimistic, forecasting 3,050.

Glaxo Holdings was among the winners. The shares rose 16p to 784p as it responded to alleged worries about the growth of some of its high-profile drugs by revealing that Imigran, the anti-migraine drug, had been approved in Germany. It now has approval in 32 countries and has been launched in 22. The German marketing will start early next year.

Imperial Chemical Industries, hit by worries about its demerger and bulk chemical trading, also staged a recovery, ending 16p higher at 1,025p. Nikko believes the market is adopting a too short-term attitude over the group and Zeneca, its drugs division scheduled to be hived off.

Andy Porter, analyst, said: 'Any short-term weakness should be used to build up holdings. The ICI/Zeneca demerger is the culmination of a restructuring programme which has transformed the group.' He believes the share should reach 1,200p next year, outperforming the forecast market advance.

Queens Moat Houses, another share that has been under pressure, rallied 4p to 38p in heavy trading. The group has undertaken City meetings this week that have led to downgradings. But Paribas Capital Markets believes the shares are oversold.

(Graph omitted)

Takeover candidate Tarmac gained another 3p to 116p.

Asda, the supermarket group, attracted frenetic activity following the better-than-expected interim figures. The price reached 61p, up 7.5p, with Seaq putting volume at a remarkable 98 million shares. Tesco, on its French connection, rose 8p to 253p. Argyll Group continued to benefit from its Scottish presentation, gaining 14.5p to 409.5p.

But it was not all pre-Christmas cheer. Thames TV was one to miss the party as its consortium failed to win the Channel 5 contract. The shares fell 22p to 158p. But Carlton Communications, replacing Thames on the TV screens, jumped 21p to 739p.

De Beers, the South African mining group, was at one time down sharply as it became known that a diamond exchange was due to open in Siberia next year. The shares later recovered much of their fall, closing at pounds 12 5/8.

Zetters, the pools group, also gave ground, ruffled by the Government's decision to introduce a national lottery. The shares fell 11p to 82p.

Shares romped ahead again yesterday, with the FT-SE 100 index jumping 49.4 points to 2,789.7.

Trading was heavy, with Seaq putting volume at 939.5 million shares and 31,495 bargains registered. Government stocks were much more subdued, scoring a few scattered gains

Shares of the Geest fresh food group went bananas yesterday. They jumped 53p to 343p in response to the EC tariffs imposed on Latin American banana imports. But the shares are nearly 100p below their year's high. The group has found trading difficult this year and is expected to suffer a pounds 4.2m decline to pounds 22m. But a partial recovery is expected next year.

Aminex, one of the more washed out tertiary oil stocks, joined in the stock market advance. Long neglected, the shares gained 1.5p to 5.25p reflecting moves to resurrect the company by the chairman Brian Hall. The latest deal was the acquisition of a 12.97 per cent interest in the El Biban field, off Tunisia. The vendor, Svenska Petroleum, took a 4.5 per cent stake in Aminex.

Start your day with The Independent, sign up for daily news emails
ebooks
ebooksAn introduction to the ground rules of British democracy
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Recruitment Genius: Compliance Manager

£40000 - £60000 per annum: Recruitment Genius: A Compliance Manager is require...

SThree: Talent Acquisition Consultant

£22500 - £27000 per annum + OTE £45K: SThree: Since our inception in 1986, STh...

Recruitment Genius: Experienced Financial Advisers and Paraplanners

Negotiable: Recruitment Genius: This extremely successful and well-established...

Guru Careers: FX Trader / Risk Manager

Competitive with monthly bonus: Guru Careers: We are seeking an experienced FX...

Day In a Page

Seifeddine Rezgui: What motivated a shy student to kill 38 holidaymakers in Tunisia?

Making of a killer

What motivated a shy student to kill 38 holidaymakers in Tunisia?
UK Heatwave: Temperatures on the tube are going to exceed the legal limit for transporting cattle

Just when you thought your commute couldn't get any worse...

Heatwave will see temperatures on the Tube exceed legal limit for transporting cattle
Exclusive - The Real Stories of Migrant Britain: Swapping Bucharest for London

The Real Stories of Migrant Britain

Meet the man who swapped Romania for the UK in a bid to provide for his family, only to discover that the home he left behind wasn't quite what it seemed
Cheaper energy on the way, but it's not all sunshine and rainbows

Cheaper energy on the way, but it's not all sunshine and rainbows

Solar power will help bring down electricity prices over the next five years, according to a new report. But it’s cheap imports of ‘dirty power’ that will lower them the most
Katy Perry prevented from buying California convent for $14.5m after nuns sell to local businesswoman instead

No grace of God for Katy Perry as sisters act to stop her buying convent

Archdiocese sues nuns who turned down star’s $14.5m because they don’t approve of her
Ajmer: The ancient Indian metropolis chosen to be a 'smart city' where residents would just be happy to have power and running water

Residents just want water and power in a city chosen to be a ‘smart’ metropolis

The Indian Government has launched an ambitious plan to transform 100 of its crumbling cities
Michael Fassbender in 'Macbeth': The Scottish play on film, from Welles to Cheggers

Something wicked?

Films of Macbeth don’t always end well - just ask Orson Welles... and Keith Chegwin
10 best sun creams for body

10 best sun creams for body

Make sure you’re protected from head to toe in the heatwave
Wimbledon 2015: Nick Bollettieri - Milos Raonic has ability to get to the top but he must learn to handle pressure in big games

Nick Bollettieri's Wimbledon files

Milos Raonic has ability to get to the top but he must learn to handle pressure in big games
Women's World Cup 2015: How England's semi-final success could do wonders for both sexes

There is more than a shiny trophy to be won by England’s World Cup women

The success of the decidedly non-famous females wearing the Three Lions could do wonders for a ‘man’s game’ riddled with cynicism and greed
How to stop an asteroid hitting Earth: Would people co-operate to face down a global peril?

How to stop an asteroid hitting Earth

Would people cooperate to face a global peril?
Just one day to find €1.6bn: Greece edges nearer euro exit

One day to find €1.6bn

Greece is edging inexorably towards an exit from the euro
New 'Iron Man' augmented reality technology could help surgeons and firefighters, say scientists

'Iron Man' augmented reality technology could become reality

Holographic projections would provide extra information on objects in a person's visual field in real time
Sugary drinks 'are killing 184,000 adults around the world every year'

Sugary drinks are killing 184,000 adults around the world every year

The drinks that should be eliminated from people's diets
Pride of Place: Historians map out untold LGBT histories of locations throughout UK

Historians map out untold LGBT histories

Public are being asked to help improve the map