Hidden riches have long lurked at the group. Its 57.5 per cent stake in Hong Kong Telecom accounts for most of its pounds 9.3bn capitalisation. Mobile telephones, cabling, 80 per cent of the Mercury telephone network and a host of joint ventures, help make the sum of the parts worth far more than pounds 9.3bn. The shares are expected to underperform until C&W grasps the break-up nettle.
One suggestion is that the company is on the verge of a deal with its mobile phones rival Vodafone, which has been weighed down by stories that it plans a heavy cash call to fund a bid. There is also persistent talk of boardroom unease at Cable; Lord Young, the chairman, is said to be striving to resist moves to split what is regarded as a telecommunications federation. Today's interim results are expected to be uninspiring with profits emerging at pounds 611m against pounds 567m.
Cable shares slipped 2p to 423p with Vodafone recovering a little with a 4p gain to 255.5p.
Zeneca, the drugs group, was the outstanding blue chip, surging 46.5p to a 1,290.5p peak as stories continued to circulate of an overseas bid. Turnover was not particularly heavy but with much of the buying seemingly coming from Switzerland, home of Roche and the Ciba-Geigy drugs groups, the market was quickly gripped by take over fever.
Rumours linking Zeneca with an overseas strike have often captivated the market. This year the drugs industry has produced a series of spectacular deals and there is surprise Zeneca has managed to remain aloof from the scramble.
The rest of the stock market enjoyed its best gain for a month with the FT-SE 100 index up 23.5 points at 3,571.4. A fall in retail sales prompted thoughts of an interest rate cut and the Queens Speech received a favourable reception. And with New York, in early trading, stretching to new highs the uncertainty created by the looming Budget was for once pushed aside.
Next, the retailer, had an outstanding day,moving to yet another peak, up 17p at 436p. A NatWest Securities push, following a meeting with the company, prompted the gain. The summer heatwave has produced doubts about many clothing groups. Most will have to work hard to recover lost sales. But the story from Next, it would appear, is that it has weathered the sunshine in better shape than most and profit estimates stretching to pounds 123m will be hit. Asda, the supermarket chain, added 3.75p to 102.5p on Credit Lyonnais Laing support and Storehouse put on 15p to 311p on a Barclays de Zoete Wedd recommendation.
Hambros, the merchant bank, produced the expected poor figures but the shares gained 9p to 202p following the declaration by Gruppo Bancario San Paolo, the Italian bank, that it intended to lift its shareholding to near 20 per cent.
Abbey National held at 569p as it became apparent it had approached the Woolwich and Alliance & Leicester building societies.
Unigate gained 7p to 432p after it confirmed a long running market rumour - the sale of its 29 per cent interest in the Dutch baby food group, Nutricia. The pounds 330m sale is likely to prompt a flurry of deals by Unigate with Hazlewood Foods, up 3p at 111p, the favourite target.
The surprise assets swap left Tarmac 9p up at 93.5p and George Wimpey 15p better at 127p. Lloyds Chemists enjoyed a late run, gaining 16p to 248p as bid speculation resurfaced. Cray Electronics also jumped 8p to 54p on vague talk of corporate action.
Aminex, the oil group with interests in the former Soviet Union, held at 54p. ABN Amro Hoare Govett suggested the shares were worth 91p and forecast profits of pounds 600,000 this year and pounds 4.4m next.
Pentex, the oil group, gained 20p to 140p on the agreed share exchange offer from Melrose which is raising pounds 13.2m through a rights issue.
Roxspur made the expected dismal return , trading at its 3p rights price against a 6.5p suspension.
Bruntcliffe Aggregates gained 2p to 22p as Albert E Sharp suggested that the shares "look substantially undervalued". The broker said that Bruntcliffe had "no major exposure to risk of further road cutbacks" and enjoyed the prospect of earnings enhancing acquisitions. Profits are forecast at pounds 1.85m for this year and pounds 2.2m next.
r Applied Holgraphics continued its firm run, adding 7p to 103p. Talk of a contract with Microsoft, the US computer house, is apparently helping the action.
The group is one of the biggest blue-sky hope shares in the market. The price has touched 359p. But AH has chalked up 12 years of losses and profits are not expected, even by the optimists, for some time. Earlier this year it raised pounds 2.3m through a rights issue at 60p.
r Learmonth & Burchett Management Systems will offer 5 million shares in the US in the next few weeks. It is, in effect, abandoning the London market.
The software group was loss-making in its past two years, but has swung back into profit this year and should make more than pounds 3m. The shares fell 10p to 358p.Reuse content