With the investment meetings leaving Glaxo down 27p at 1,622p the obvious assumption was that the drugs giant was edging nearer to mounting a hostile bid for its erstwhile partner.
Glaxo is known to be considering the possibility of a strike. Putting such a bid together is, however, fraught with difficulties. And the message emerging from the meetings did not, according to some stock market men, support the theory of a Glaxo assault.
Glaxo's rumoured reluctance raised the possibility that American activity could re-appear. Before the Glaxo talks SB had agreed a merger with American Home Products. Although such a deal is unlikely to be resuscitated following the bad feeling caused by SB's behaviour, other US groups could be interested.
There is a widespread view in the drugs industry that SB's two failed mergers have left the group, if reluctantly, holding a for sale sign. Its shares hit 845p at the height of the Glaxo excitement. A year ago they were 424p.
The rest of the market drew some strength from the unchanged base rate decision but had to contend with worries about New York, which although weak was less depressed than anticipated.
Footsie, at one time down 104 points, closed 37.5 lower at 5,695.6p. Supporting indices also gave ground.
Banks were hit by NatWest Securities. It downgraded its recommendations on Halifax and Alliance & Leicester to sell and moved its stance on Lloyds TSB, Northern Rock and Abbey National from add to hold. Said NatWest's Mark Eady: "Our evaluation model is saying quite a few of them are a bit punchy".
Halifax, after falling 20p, ended 2p lower at 923p and A&L ended 2p higher at 904.5p after falling 34.5p.
Lloyds lost 5p at 880p; NR fell 22.5p to 611.5p and Abbey 55p to 1,148p. National Westminster Bank, NatWest's former parent, gave 37p to 1,053p. Other banks lowered included HSBC, 55p to 1,705p, and Bank of Scotland, 25p to 632p.
Telephones had their wires crossed on the expected Monopolies & Mergers Commission inquiry into mobile charges. BT fell 13p to 592p and Vodafone lost 20p at 516p. Cable and Wireless softened 13.5p to 545.5p but Orange responded with a 3p gain to 328p, saying the probe will make little impact.
Computer shares suffered on the back of the profits warning from US chip maker Intel. Sage softened 62.5p to 1,232.5p and Misys fell 60p to 2,665p.Wednesday's profit warnings continued to extract their toll. DFS Furniture fell a further 24.5p to 439p and chemical group Meconic slumped 70p to 207.5p.
Arjo Wiggins Appleton, the packaging and paper group, kept up its revival, gaining 11.5p to 198p on a 61 per cent profit advance to pounds 216.1m. David S Smith moved ahead a further 2p to 217.5p. Arcadia, the retailer, retreated 13.5p to 487.5p following Morgan Stanley caution. Next, still smarting from Great Universal Stores apparent lack of interest, fell a further 22p to 712p.
Rolls-Royce, on its figures, was the best performing blue chip, up 16.5p to 252.5p PowerGen recovered 30p to 790p on Goldman Sachs support and waters were firmer with Thames Water up 28p to 886p.
Safeway, the supermarket chain, was hoisted 13.5p to 387p on renewed bid hopes and Schroders responded to Morgan Stanley bid talk with a 75p gain to 2,230p.
More, the advertising group, soared 190p to 1,024p on the agreed pounds 446m US bid; other advertising groups improved with Maiden up 42.5p to 366p.
Airtours, the holidays group, added 8p to 468p on, it is thought, ABN Amro encouragement.
Magnum Power surged a further 6.25p to 20.75p on incorrect suggestions stockbroker Colin Blackbourn had built a stake; Springwood, the leisure group, jumped 24p to 132.5p, responding to the Charles Stanley profit estimates.
Staveley Industries firmed to 130p. The salt to measuring equipment group is one of the targets of Sir Ron Brierley's Guinness Peat. It lifted its holding to 12.2 per cent, acquiring one million shares. Guinness is bidding for Bluebird Toys after building a stake.
ScS Upholstery, a furniture retailer, firmed 2.5p to 142,5p against December's 105p flotation. Three stores are near to opening, lifting the chain to 15 and adding 28 per cent to selling space. The stockbroker Collins Stewart increased its profit forecast from pounds 3.7m to pounds 4m.Reuse content