Market Report: Sterling's fall starts a stampede into exporters

The stock market was in euphoric mood as sterling weakened and takeover talk swirled around.

The pound's dramatic slide started the stampede. Said one leading stockbroker: "I was in my bath when I heard on the radio about the pound's sudden fall from grace; as soon as the market opened we were ready to sell domestic shares, like supermarkets, and pile into exporters."

He was not the only one to get the message. Exporters, hit as sterling strengthened in recent months, were suddenly in rampant form as many of the groups with extensive home market exposure wilted.

The drugs groups enjoyed the additional benefit of yet another round of takeover speculation. SmithKline Beecham led blue chips with a 36.5p gain to 880p with some talking of a strike from Roche, the Swiss giant. Zeneca, for long the favoured Roche target, jumped 51p to 1,723.5p.

But a 32.5p gain to 956.5p by Glaxo Wellcome, which could eventually descend on Zeneca, illustrated the pound's strong contribution to the market's drugs fixation.

Others drawing encouragement from sterling included Grand Metropolitan, British Steel and Allied Domecq.

It was enough to lift Footsie 52.4 points, its best gain since November, to a 4,271.5 peak. The supporting FTSE 250 index jumped 29 to cross 4,600 for the first time, ending at 4,616.

Datastream calculated the market is now valued at pounds 117.6bn with yesterday's advance adding pounds 11.9bn.

Retailers were big casualties. A sudden round of negative comments on superstores also took its toll. For example Barclays de Zoete Wedd said sell Somerfield and ABN Amro Hoare Govett turned bearish on J Sainsbury, trading statement today, and Asda. But Kleinwort Benson, NatWest Securities and SBC Warburg were largely positive on the sector. The latest AGB Research supermarket survey, indicating a fall in Asda's market share, was another influence.

Worries about Sainsbury also eroded confidence. There are fears the group will produce a cautious trading message with some talking about the possibility of reorganisation charges and provisions against unexpected do-it-yourself costs. The shares, however, bucked the trend, up 5p to 392p.

The expected interest rate standstill until the election and what appeared to be a scramble by some institutions to climb on the equities bandwagon also contributed to the market's exhilarating display.

Fund managers were again on bid alert on the story German bank Dresdner is on the prowl. Mercury Asset Management gained 31.5p to 1,307.5p and Henderson Administration moved ahead 55p to 1,332.5p.

National Grid gained 3p to 215p with Kleinwort signalling a 240p target and Smiths Industries improved 19.5p to 774.5p ahead of an Albert E Sharp presentation.

Williams Holdings was helped 7p higher to 334p by BZW support. Dixons fell 8.5p to 498.5p; a seller of more than 1 million shares had to retire without dealing.

Senior Engineering put on 4p to 117p in busy trading on whispers of takeover action. William Cook, with an pounds 80m leverage buyout threatening the contested Triplex Lloyd offer, rose 45p to 720p. Triplex, considering its next move, firmed 2p to 190p.

Second-line drug shares were active with Medeva, up 8.5p to 288p following a link with Peptide Therapeutics, 47.5p higher at 289p. British Biotech came in from the cold, up 21.5p to 230p. Shield Diagnostics fell 7p to 130.5p after warning about losses.

Thomas Jourdan, the consumer group, held at 46p; David Abell has lifted his interest to 21.23 per cent. English National Investment Co, controlled by Joseph Lewis, scored a 49p gain to 172.5p as the Bahamas-based multi- millionaire granted the company an option on his pounds 40m, 25.1 per cent stake in Glasgow Rangers.

Critchley, an electric components group, fell 37.5p to 760p on profit downgrades and Ryland, the garage chain, reversed 12p to 88.5p as bid talks, thought to be with Sanderson Bramall, broke down.

Wainhomes, the builder, firmed to 134p; after the market closed Bellway Homes said it had sold its 4.8 per cent stake, seemingly at 130p. Barratt Developments was a victim of the switch to exporters, tumbling 10.5p to 275p and John D Wood, the upmarket estate agent, rose 9.5p to 99.5p after a 244 per cent interim profits gain to pounds 795,000.

Manchester Utd climbed 9.5p to 728.5p. Sharelink, the execution-only broker, said of its 10 most actively traded shares in the past week five were football clubs.

PROMOTED VIDEO
News
ebooksAn unforgettable anthology of contemporary reportage
Money
Welcome to tinsel town: retailers such as Selfridges will be Santa's little helpers this Christmas, working hard to persuade shoppers to stock up on gifts
news
News
i100
News
people
Arts and Entertainment
Architect Frank Gehry is regarded by many as the most important architect of the modern era
arts + entsGehry has declared that 98 per cent of modern architecture is "s**t"
Arts and Entertainment
Soul singer Sam Smith cleared up at the Mobo awards this week
arts + entsSam Smith’s Mobo triumph is just the latest example of a trend
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

Compensation and Benefits Manager - Brentwood - Circa £60,000

£60000 per annum: Ashdown Group: Compensation and Benefits Manager - Compensat...

Data Analyst/Planning and Performance – Surrey – Up to £35k

£30000 - £35000 Per Annum plus excellent benefits: Clearwater People Solutions...

IT Systems Business Analyst - Watford - £28k + bonus + benefits

£24000 - £28000 per annum + bonus & benefits: Ashdown Group: IT Business Syste...

Markit EDM (CADIS) Developer

£50000 - £90000 per annum + benefits: Ampersand Consulting LLP: Markit EDM (CA...

Day In a Page

Wilko Johnson, now the bad news: musician splits with manager after police investigate assault claims

Wilko Johnson, now the bad news

Former Dr Feelgood splits with manager after police investigate assault claims
Mark Udall: The Democrat Senator with a fight on his hands ahead of the US midterm elections

Mark Udall: The Democrat Senator with a fight on his hands

The Senator for Colorado is for gay rights, for abortion rights – and in the Republicans’ sights as they threaten to take control of the Senate next month
New discoveries show more contact between far-flung prehistoric humans than had been thought

New discoveries show more contact between far-flung prehistoric humans than had been thought

Evidence found of contact between Easter Islanders and South America
Cerys Matthews reveals how her uncle taped 150 interviews for a biography of Dylan Thomas

Cerys Matthews on Dylan Thomas

The singer reveals how her uncle taped 150 interviews for a biography of the famous Welsh poet
DIY is not fun and we've finally realised this as a nation

Homebase closures: 'DIY is not fun'

Homebase has announced the closure of one in four of its stores. Nick Harding, who never did know his awl from his elbow, is glad to see the back of DIY
The Battle of the Five Armies: Air New Zealand releases new Hobbit-inspired in-flight video

Air New Zealand's wizard in-flight video

The airline has released a new Hobbit-inspired clip dubbed "The most epic safety video ever made"
Pumpkin spice is the flavour of the month - but can you stomach the sweetness?

Pumpkin spice is the flavour of the month

The combination of cinnamon, clove, nutmeg (and no actual pumpkin), now flavours everything from lattes to cream cheese in the US
11 best sonic skincare brushes

11 best sonic skincare brushes

Forget the flannel - take skincare to the next level by using your favourite cleanser with a sonic facial brush
Paul Scholes column: I'm not worried about Manchester United's defence - Chelsea test can be the making of Phil Jones and Marcos Rojo

Paul Scholes column

I'm not worried about Manchester United's defence - Chelsea test can be the making of Jones and Rojo
Frank Warren: Boxing has its problems but in all my time I've never seen a crooked fight

Frank Warren: Boxing has its problems but in all my time I've never seen a crooked fight

While other sports are stalked by corruption, we are an easy target for the critics
Jamie Roberts exclusive interview: 'I'm a man of my word – I'll stay in Paris'

Jamie Roberts: 'I'm a man of my word – I'll stay in Paris'

Wales centre says he’s not coming home but is looking to establish himself at Racing Métro
How could three tourists have been battered within an inch of their lives by a burglar in a plush London hotel?

A crime that reveals London's dark heart

How could three tourists have been battered within an inch of their lives by a burglar in a plush London hotel?
Meet 'Porridge' and 'Vampire': Chinese state TV is offering advice for citizens picking a Western moniker

Lost in translation: Western monikers

Chinese state TV is offering advice for citizens picking a Western moniker. Simon Usborne, who met a 'Porridge' and a 'Vampire' while in China, can see the problem
Handy hacks that make life easier: New book reveals how to rid your inbox of spam, protect your passwords and amplify your iPhone

Handy hacks that make life easier

New book reveals how to rid your email inbox of spam, protect your passwords and amplify your iPhone with a loo-roll
KidZania lets children try their hands at being a firefighter, doctor or factory worker for the day

KidZania: It's a small world

The new 'educational entertainment experience' in London's Shepherd's Bush will allow children to try out the jobs that are usually undertaken by adults, including firefighter, doctor or factory worker