With trading remaining thin the stock market presented a rather artificial appearance, often giving the impression it was merely ticking over awaiting the end of the sultry days of summer.
Much of the day's action revolved around the takeover bid that never was. For months rumours have swirled that Grand Metropolitan was destined to be the subject of corporate action. High on the list of possibilities was a break-up bid. The weekend revelation that Guinness had looked at Grand Met was enough to send the food and drink group's shares ahead 18p to 440p. By Grand Met standards it was a good display as the shares have been persistently weak performers.
Guinness ended 4p higher at 474p after touching 479p. Although the stories of a bid for Grand Met turned out to be wide of the mark they did at least demonstrate that the brewing and spirits giant was acutely aware of its slumbering shares and was casting around for ways to improve its image.
Other spirit shares stirred modestly. Allied Domecq managed an early 7p gain but settled little changed at 448p. Burn Stewart, a tiddler, edged ahead 2p to 101p. Macallan Glenlivet, which has suffered the indignity of a bid below its market price, firmed to 158p; Highland Distilleries, the predator with 51 per cent of the capital, also edged ahead. MacGlen is expected to comment on the bid this week.
If nothing else the Guinness affair is seen as demonstrating that further corporate action is likely in the world spirit market which is dominated by UK groups.
Grand Met has said it looked at demerging its food and spirit operations but decided it would not improve shareholder value. Allied is widely expected to opt for splitting its retailing and spirit businesses into stand-alone operations. Glenmorangie, unchanged at 765p, is adopting a higher profile and once its ruling family relinquishes control the malt whisky group would be open to a bid.
Glaxo Wellcome had a volatile session, closing down 8p at 873p after 857p. It is appealing against a surprise US court decision which could open the floodgates to copies of its best-selling ulcer drug Zantac, which has sales of pounds 2.2bn.
But on the ill-wind philosophy Holliday Chemicals, set to produce a generic form of Zantac in the US, gained 11p to 144p.
Bank of Scotland edged forward 3p to 244p as marketing got under way for the sale of most of Standard Life's stake. The insurance group is selling around 29 per cent, retaining 2.5 per cent.
Reuters, the information group, was firm at 772p ahead of an Internet seminar and Marks & Spencer rose 2p to 490p, a 12-month high, ahead of an expected encouraging trading statement at tomorrow's AGM. Allders put on 13p to 211p; it is planning to hand out some of the pounds 160m windfall from the sale of its duty-free business. A share buy-back or more shareholder- friendly special dividend is expected.
Lucas Industries dropped 9p to 218p on stories its proposed partner, Varity, the US car parts group, could attract a bid before the merger can be consummated.
Orange, off 3.5p, found a new 204p low and utilities were under pressure on the continuing debate about a windfall tax.
The expectation of takeover action among media players continued to create interest. HTV remained on the recovery road, up 7p at 350p; Yorkshire rose 15p to 1,255p.
Eurocopy, the photocopier group, tumbled 16p to 74p as a trust linked to chairman Cyril Gay placed nearly 10 million shares with institutions. The pending departure of chief executive Claes Hultman continued to worry Eurotherm, off 24p at 520p.
Healthcall tumbled 29.5p to 105.5p following a profit warning and Shield Diagnostics' profit standstill and disappointment it could not provide more details of its trials pushed the shares 19p down to 141p; Systems Integrated Research, floated at 115p in April, tumbled 27p to 88p as it forecast a loss approaching pounds 400,000. The dull computer sector left MM Computing off 23p at 465p and Micro Focus 10p at 790p.
Cirqual, the aluminium specialist, made the expected rousing debut, closing at 138p against a 122p placing. Pordum, a food delivery service, ended at 3.5p against a 3p placing.