Then gilts took over. A leaked British purchasing managers' survey showing a sharp jump in June prices did the damage.
Only a few years ago such a report would have had little, if any, impact. But, with the Government's flag tied to low inflation, the purchasing managers are now taken very seriously.
So gilts, with weak overseas bond markets making an impression, fell by about pounds 1 3/4 , dragging equities down.
A poor New York opening was the final straw and, with many fund managers prepared to sit it out on the last day of their half- year reporting period, Footsie was nursing a 27.1-point fall to 2,919.2 at the close.
Banks were weak. Abbey National's decision to slash its overdraft rate from 18.4 to 9.9 per cent sent a shudder through the sector, producing double-figure falls.
As competition worries multiplied Abbey fell 13p to 393p and Barclays lost 16p to 519p. Lloyds was lowered 14p to 525p, National Westminster 24.5p to 431.5p and TSB 7p to 203p.
An Abbey spokesman said the building-society-turned-bank felt too much was being charged for overdrafts. The cut made Abbey the 'most competitive in the UK'.
Lasmo dropped 8.5p to 134.5p, lowest since hostilities erupted. Bidder Enterprise Oil rose 7p to 389p. The bid closes today.
The Telegraph's hesitant recovery came to an abrupt end as Cazenove resigned as company stockbroker.
It was known to be unhappy over the share sale by Hollinger, the company controlled by Telegraph chairman Conrad Black, before the newspaper group's shares were devastated by the decision to slash the price of the Daily Telegragh. The shares fell 15p to 364p.
Eurotunnel was another forced to give ground. News that passenger services had been delayed once again knocked the shares 12p to 260p.
On the supermarket pitch Asda's results pushed the shares 0.75p higher to 52.25p. Tesco, down 5p at 224.5p, was the subject of what was thought to be a bed-and-breakfast deal, with Seaq putting volume at 28 million shares.
WPP held at 99p. There were indications that some of the communications group's banking shareholders were unloading stock acquired in one of the rescue restructurings.
Invesco, the investment management group, was also heavily traded as IMI Capital Markets shuffled its 10 per cent shareholding. The shares were unchanged at 169p.
Gestetner, the office equipment group, fell 19p to 144p as international trader Inchcape did not pursue its option to increase its shareholding, thereby destroying the recent round of bid speculation.
Inchcape put on 5p to 449p on the consequent evaporation of rights issue fears.
Zeneca, the drugs group, pushed ahead 5p to 727p following an investment meeting for its schizophrenia treatment. But Wellcome, strong recently on US takeover chatter, slumped 27p to 590p as it faced new competition from SmithKline Beecham over its shingles drug.
Kingfisher, the Comet and Woolworth group, rose 9p to 499p. A leading investment house, thought to be Barclays de Zoete Wedd, took the shares off its sell list. Carlton Communications dipped 11p to 807p as Kleinwort Benson was said to have turned negative.
The day's newcomers did moderately well. JBA, a computer group, stretched to 164p from a 160p sale price. Universal Ceramic Materials ended at 88p from an 86p offer.
Rights issue considerations loomed large. Wassall, the conglomerate, gained 13p to 292p following a 97.4 per cent rights take- up. But Euro Disney had another attack of the jitters, with the shares losing 10p to 123p and the rights 9p to a mere 14p.
Scottish & Newcastle, the last big brewer to report in the industry's summer profit season, fell 11p to 509p. The market expects about pounds 230m against last year's pounds 201m.
But most observers will be more interested in the current year's performance, which will include a full year's contribution from the Chef & Brewer pubs chain, acquired from Grand Metropolitan.
The increased Scottish retail spread is seen as the main investment attraction of the group.
The FT-SE 100 index lost 27.1 points to 2,919.2 and the FT-SE 250 index slipped 1.1 to 3,414.1. Turnover was 600.8 million shares with 23,190 bargains recorded. The account ends today; settlement is on 11 July.
Alvis, the military vehicle group, has duly cut its shareholding in Avimo, its Singapore quoted off- shoot. It has sold 11.7 million shares, realising pounds 8.4m, reducing its shareholding to 40 per cent. The cash will be used to develop its domestic operations. Rumours have circulated for some time that Alvis planned to reduce its Singapore involvement. Its shares firmed to 64p.
Strong & Fisher, the leather group, is transferring from full listing to the USM, which is due to close next year. This odd manoeuvre is aimed at keeping the share quotation alive and should indicate planned corporate expansion. As part of the deal Hillsdown Holdings, down 2p to 154p, is cutting its Strong shareholding from 90.2 per cent to 87.9 per cent.
(Graph omitted)Reuse content