The mobile phone group was one of the most actively-traded stocks with more than 27.3 million shares changing hands as dealers scrambled to get a piece of the action.
The reason for the huge volume - equivalent to 2 per cent of Orange's issued shares - was the decision by one UK institution to get rid of around 13 million shares.
The name of the shareholder remained a closely-guarded secret, but the boys in dark glasses mentioned Prudential, Standard Life and Legal & General as potential sellers. The mystery institution asked a leading house, believed to be Merrill Lynch, to place the stake in the market, and the broker duly obliged.
Market insiders believe that Merrill bought the shares for around 850p and sold them at 855p in a matter of minutes in the early afternoon. The transaction depressed Orange's share price, which was hovering around 870p at the time.
The stock went down to 855p before recovering in the afternoon to close down 4.5p to 870p. The large sale raised the prospect that other shareholders might follow suit, paving the way for a takeover of the mobile operator.
The Far Eastern conglomerate Hutchison Whampoa owns a giant 44 per cent stake in Orange, while the defence group British Aerospace has around 5 per cent. Any sell-off by these two could set the bid phones ringing.
The other big story of the day came courtesy of SmithKline Beecham. The drugs giant shot 31.5p higher to 828p on rumours of a mega-deal with its Swiss rival Novartis. Dealers said that SB could be third-time lucky after the failure of talks with American Home Products and Glaxo Wellcome. The rationale for a merger, or even a hostile takeover by Novartis, is that the Alpine drug-maker needs a big deal to boost its growth.
Some strategic thinkers claimed that any bid for SB would be trumped by Glaxo, worried about losing its ideal partner. Hopes of a resurrection of the Glaxo-SB tie-up - the City's favourite deal - sent Glaxo 52p higher to 1,805p. The European approval of flu drug Relenza also helped.
The consolidation rumours in the heavyweight pharmaceutical sector helped the blue-chip index to finish in profit despite a slump on Wall Street.
The FTSE 100 was 52.2 higher at 6,302.2 at the close, when its US counterpart was down more than 100 points.
Invensys topped the leaders' board, after maiden results prompted a 31.25p jump to 316.25p. The old BTR Siebe pleased brokers with a 20 per cent rise in merger savings and the promise of a pounds 1bn cash back. Warburg and Merrill Lynch said "buy" up to 350p.
BAT puffed 22.5p to 616p as tracker funds filled their boots ahead of the completion of the Rothmans merger, while Rio Tinto, up 37p to 935p and Billiton, 6.25p higher at 189.25p, benefited from improving metal prices.
Late buying helped Shell to reverse earlier losses and close up 10p at 453p. Rumours of a deal with BG, up 4.5p to 353.75p, are still alive. Its spin-off Centrica was up 4.5p to 127.5p on hopes that it might buy road services groups AA or Lex, down 3p to 589p.
Sainsbury's bagged an 8.5p rise to 388.25p as the market welcomed the much-needed restructuring programme and the better-than-expected figures. Asda was 4.25p better to 183p in sympathy, but Somerfield shed 6p to 280.5p as traders switched to the big boys.
Cadbury Schweppes was 11.75p higher at 438.25p after the UK regulator approved the sale of its drinks to Coca-Cola.
Banks were enlivened by serious and ridiculous stories. Bank of Scotland was the worst-performing blue-chip after falling 32.5p to 850p. The ungodly slump came on fears that its links with US evangelist Pat Robertson will cost it some lucrative mandates.
A warning by broker CSFB that the financial sector is overvalued sent Alliance & Leicester 33p down to 887p, Barclays 7p lower to 1,849p, and Halifax 6p down to 819.5p.
A bid rumour feast helped the Mid Cap to a 41.3 rise to 5,709, even though the Small Cap underperformed and closed 1.8 lower at 2,547.8.
British Steel stole the show. The stock soared 28p to a 12-month peak of 161.75p after unveiling a surprise merger with Dutch rival Hoogovens. More details will be revealed before Monday.
Business services group Serco jumped 107.5p to 1,380p while rival Capita went 29p higher at 661.5p. A rebound from recent weakness and vague whispers of corporate action were responsible.
Hopes of consolidation in the oversupplied milk sector triggered buying in Express Dairies, 9.5p better at 127.5p, and Dairy Crest, up 11.5p to 316p.
Takeover target Williams jumped 17p to 392.5p on talk of a strike. Rentokil Initial, up 2.5p to 267.25p, was mentioned but a US bidder was seen as more likely. Rank rose another 3p to 242p on break-up bid talk, while buns-to-guns conglomerate Tomkins climbed 16p to 249p amid rehashed takeover hopes.
Fashion retailer Matalan stretched 30p higher to an all-time peak of 872.5p on hopes of buoyant trading, while jeweller Signet sparkled 2p up to 53.25p after a good first quarter.
Sterling's strength hammered chemical groups Croda, down 9.5p to 289p, Laporte, 13p off at 738.5p, British Vita, 4 lower at 242.5p and BTP, 9p down at 402.5p ahead of next week's results.
Chip-maker ARM Holdings lost 30p to 567.5p after a heavy US sell-off of technological stocks.
The tiny bookie Surrey Group pocketed a 0.25p win to 1.50p on hopes of an imminent Internet link-up. Racetrack owners Arena Leisure galloped 3p ahead to 21.5p after the pounds 16m buy of rival RAM Racing. Hotels group Queens Moat firmed 1.75p to 31.25p in heavy volume on vague hopes of corporate action.
Profit warnings hit management consultant Proudfoot, down 2.75p to 20p, and electronics group Roxspur, 2.5p lower at 26.5p. TV company West 175 shed 6p to 117.5p despite confirmation of a management contract for a New Zealand regional channel.
SEAQ VOLUME: 996.5m
SEAQ TRADES: 65,722
GILTS INDEX: 106.36 -0.16
INFOBANK, a developer of electronic commerce software, could soon produce some good news.
The shares, which topped 312p last year, logged on a 1.5p rise to 101.5p yesterday amid talk of deals with major credit card groups. The company recently signed a strategic agreement with Visa and is in talks with other providers of plastic credit.
The deals would enable Infobank to sell its e-commerce kit to the credit card operators' clients.
THE MEDICAL equipment minnow Advanced Medical Solutions could be active over the next few months.
Several healthcare groups are believed to be interested in licensing AMS' wound-healing products. Some of the medicines are already distributed by Boots and partners could include the US Procter & Gamble and Johnson & Johnson, and UK group Smith & Nephew. AMS shares closed unchanged at 30p yesterday.