Perpetual surges as intrigue grips financial sector

MARKET REPORT
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The Independent Online
Perpetual, the fund management group, is intriguing the stock market. The shares have responded to the heady take- over euphoria which has captivated the financial sector as stories of bids and deals have swirled around.

But whereas many financial shares have felt obliged to pause for breath Perpetual has continued to power ahead.

They surged another 58p to a 2,133p peak with some saying it will soon relinquish its independence with, again, inevitably, cash-rich National Westminster Bank, known to want to increase its fund management side, regarded as the most likely bidder.

Any deal would need the say-so of Martin Arbib, the racehorse owner who started the company in what has been described as a Henley-on-Thames garret 22 years ago.

His family and charitable interests control around 65 per cent of the capital and although he has shown no inclination to sell there is clearly a sneaking suspicion he may yield to temptation.

With the Arbib stake the shares are a narrow market and it does not require much interest to create sharp price movements.

Other financials were less enthusiastic. Mercury Asset Management shaded a few coppers to 894p and up-for-sale Gartmore, the US group NationsBank is now the favourite to strike, stuck at 253p.

The rest of the market, buoyed by hopes of lower interest rates and New York, clawed its way to yet another peak with a 24-point gain to 3,759.3. Second-line shares, which have lagged behind the blue chip elite, are also catching up with the supporting index 25 points off its peak, established two years ago.

Electricity shares brightened on renewed takeover speculation with Yorkshire up 35p to 719p. Southern joined the surge, up 20p to 828p and East Midland gained 18p to 697p. Talk of more American bids is in the air; Continental forays are also expected.

BSkyB, figures next week, shrugged off its Olympic Games setback to continue its romp, outperforming other blue chips with a 21.5p gain to 428p. Redland and RMC responded favourably to the measures to enliven the German economy and Bass and Scottish & Newcastle moved ahead after analyst meetings.

Insurances were excited by the Halifax decision to run its own insurance operation. With Royal Insurance handling new Halifax underwriting for household accounts, worth pounds 300m a year premium income, the shares rose 7p to 385p. Sun Alliance, which has lost a chunk of Halifax business, fell 7p to 370p.

The bio-babes had a down day with British Biotech suffering a 157p hit to 2,123p. ML Laboratories and Scotia also gave ground. Glaxo Wellcome showed the tiddlers how to perform, up 28.5p to 961.5p on Aids treatment hopes.

Cable groups enjoyed, for them, something of an upbeat performance. They have been hit hard as many householders have seemed less than impressed with the advantages of plugging into cable.

On the theory they have been oversold and must now be worth buying Nynex gained 6.5p to 92p; General Cable 11p to 179p and TeleWest 7p to 125p.

Media shares were buoyant, largely on the back of NatWest Securities enthusiasm.

Enterprise Oil was the most heavily traded share with Seaq putting volume at 161 million. The action was the result of the sale of 12.9 per cent of group by Elf, the French group. Enterprise shares fell 13p to 368p.

Hanson was again busily traded as the debate raged about the surprise break-up. The shares at one time down to 199p, ending 8.75p lower at 202.75p.

Vodofone, on talk of French expansion and Societe Generale Strauss Turnbull joining Henderson Crosthwaite as buyers, rose 7p to 237.5p. Rolls-Royce firmed 1p to 204p as Henderson talked of more orders and put a medium term target of 240p on the shares.

Greenalls "celebrated" its first day as a Footsie constituent with a 13.5p fall to 596p and a profit warning knocked 37p to 251p from catering equipment group, Lincat.

Engineer Wilshaw remained under the whip of a determined seller, falling 5p to 40p. The shares reached 80p in September.

Bardon, the aggregates group, continued to attract interest.

The shares edged ahead 1.5p to 38.5p, highest for more than 18 months. Once again turnover was high with Seaq putting the volume at almost 12 million.

Polypipe moved to a 12 month high of 194p and Scholl, the health group, held at 217p.

TAKING STOCK

r Dean Corporation, a property services group that has barely stirred since it arrived on AIM in October, seems set for a higher profile. Two deals, involving property maintenance and landscaping, could double the group's present pounds 3.2m valuation and would require a share placing. Dean, run by Stephen Dean, former head of Dean & Bowes, is acquiring 40 per cent of H Page, a building services supplier. The group hopes for profits of around pounds 200,000 last year. The shares held at 11p.

r Bruntcliffe Aggregates held at 27p, despite a share build-up. Two former directors, Anthony Hanson and Paul Kaye, have lifted their shareholding to 14.62 per cent. Conversion of loan stock and friendly supporters take their stake to 17.81 per cent.

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