Railtrack steams ahead on hopes of secret riches

MARKET REPORT

Railtrack was on the express line as the stock market sensed it could have a tantalising tale to tell at an investment presentation next week. The shares led blue chips with a 16.5p gain to 391.5p, a two-day advance of 34p.

The City has for some time been beguiled by what are regarded as Railtrack's secret riches - largely its property potential.

Some analysts have already come to the conclusion the group could comfortably accommodate a Labour windfall tax. They appear to be relaxed about even a pounds 1bn charge, although a much lower imposition is thought to be more likely.

There is a widespread feeling that Railtrack shares remain undervalued and one stockbroker is thought to be talking about them reaching 475p. The shares were privatised in May when private investors paid a 190p first instalment and institutions 200p.

The rest of the market was overwhelmed by New York. Friday's strong late run led to a confident morning session but when Wall Street traded hesitantly in the afternoon Footsie looked increasingly harassed and by the close was limping along with a 0.1-point fall. Still, before the US blues took their toll, it did manage a new trading high of 4,330.

The American connection was also less than kind to LucasVarity and EMI. The aerospace and car components group retreated 5.5p to 197.5p as the market continued to ponder how it intends to reconcile the payment demands of its US and UK investors.

EMI, 25p off at 1,101p was ruffled by indications of poor US sales; nine-month results are due later this month.

Financials remained in demand. SBC Warburg helped sentiment by producing intriguing targets for three leading fund managers. It suggested Mercury Asset Management, its former offshoot, should hit 1.500p; the price rose 26.5p to 1,382.5p.

The investment house also put a 1,550p target on M&G (up 3.5p at 1,380p) and 350p on Invesco (7.5p higher at 314.5p.).

Fund managers have romped ahead as the market has awaited a Continental strike. Dresdner of Germany and ABN Amro of Holland are two groups thought to be seeking a fund management capture. And just to add to the excitement Merrill Lynch, the US group, is now said to have joined the chase.

Insurances were again the subject of bid speculation with General Accident, up 26p to 872p and Prudential Corporation moving 9.5p higher to 581.5p.

Abbey National, expected to raise the stakes in the battle for Scottish Amicable, was little changed at 780.5p. Lloyds TSB, kicking off the banking profits season on Friday, put on 6.5p to 493p.

British Gas was unchanged at 243.5p as the grey market opened in its two constituents in their when-issued form. BG, the transportation side, traded at 173p (after 186.5p) and Centrica, the gas supplier, at 69.75p (after 72.5p).

Oils were subdued. Enterprise Oil fell 2p to 672.5p with Merrill Lynch moving its stance to sell. Lower crude prices also hit sentiment; British Petroleum fell 15.5p to 721p.

Football shares were rattled by suggestions from accountants Coopers & Lybrand they were overpriced by as much as pounds 1bn. In the past year the value of football clubs has increased 400 per cent. The accountants believe only a handful can justify current valuations.

So Southern Leisure (Southampton), Sheffield Utd and Loftus Road (QPR) felt the downward tug; even Manchester Utd gave ground, off 10.5p to 693.5p.

Granada fell 17.5p to 895p as chairman Gerry Robinson sold 57,500 shares at 914p. He now has 301,000.

Storehouse rose 12.5p to 292.5p. Morgan Stanley believes the shares are over the worst and will reach 335p.

Peptide Therapeutics jumped 40p to 369p on an alliance with SmithKline Beecham to develop allergy vaccine and Shield Diagnostic added 23p to 285p despite top-slicing by a venture capitalist.

Profit warnings were again a feature. Toad, engaged in vehicle security, reversed 19.5p to 41.5p; VDC, a pharmaceutical group, slumped 110p to 165p and Triad, a computer operation, crashed 45p to 228.5p.

Portsmouth & Sunderland Newspapers jumped 62.5p to 820p in response to a 150,000 share trade at 825p.

Newcomer C&B Publishing continued to push ahead, up another 15p at 180p, and Internet Technology rose 13p to 56.5p as Jan Murray, founder of PC World (now part of Dixons) took over as chairman.

Taking Stock

Emerald Energy rose 1p to 5.25p in busy trading. An analysts presentation, due next week, created the excitement. Managing director Peter Winton intends to discuss the company's Colombian drilling programme. There is considerable excitement about Emerald's venture. Stockbroker T Hoare says if the wells come up to scratch they would be worth up to 24p a share; US operations could add a further 4p a share.

Alpha Omikron, described as an emerging markets specialist, fell 0.25p to 3.75p. After the market closed it said Henderson Crosthwaite had resigned as broker and adviser.

Tile maker Quiligotti gained 6.5p to 21.5p as shareholders who helped save the company sold 50.75 per cent of the capital at 20.5p to institutions.

Start your day with The Independent, sign up for daily news emails
ebooks
ebooksAn introduction to the ground rules of British democracy
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Recruitment Genius: Sales Assistant / Buyer

£15000 - £17000 per annum: Recruitment Genius: This company offers a range of ...

Recruitment Genius: Customer Service Advisor

£15000 - £16000 per annum: Recruitment Genius: Customer Service Advisors are r...

SThree: Trainee Recruitment Consultant

£20000 - £25000 per annum + OTE £45K: SThree: SThree were established in 1986....

Recruitment Genius: Compliance Manager

£40000 - £60000 per annum: Recruitment Genius: A Compliance Manager is require...

Day In a Page

Greece debt crisis: What happened to democracy when it’s a case of 'Vote Yes or else'?

'The economic collapse has happened. What is at risk now is democracy...'

If it doesn’t work in Europe, how is it supposed to work in India or the Middle East, asks Robert Fisk
The science of swearing: What lies behind the use of four-letter words?

The science of swearing

What lies behind the use of four-letter words?
The Real Stories of Migrant Britain: Clive fled from Zimbabwe - now it won't have him back

The Real Stories of Migrant Britain

Clive fled from Zimbabwe - now it won’t have him back
Africa on the menu: Three foodie friends want to popularise dishes from the continent

Africa on the menu

Three foodie friends want to popularise dishes from the hot new continent
Donna Karan is stepping down after 30 years - so who will fill the DKNY creator's boots?

Who will fill Donna Karan's boots?

The designer is stepping down as Chief Designer of DKNY after 30 years. Alexander Fury looks back at the career of 'America's Chanel'
10 best statement lightbulbs

10 best statement lightbulbs

Dare to bare with some out-of-the-ordinary illumination
Wimbledon 2015: Heather Watson - 'I had Serena's poster on my wall – now I'm playing her'

Heather Watson: 'I had Serena's poster on my wall – now I'm playing her'

Briton pumped up for dream meeting with world No 1
Wimbledon 2015: Nick Bollettieri - It's time for big John Isner to produce the goods to go with his thumping serve

Nick Bollettieri's Wimbledon Files

It's time for big John Isner to produce the goods to go with his thumping serve
Dustin Brown: Who is the tennis player who knocked Rafael Nadal out of Wimbeldon 2015?

Dustin Brown

Who is the German player that knocked Nadal out of Wimbeldon 2015?
Ashes 2015: Damien Martyn - 'England are fired up again, just like in 2005...'

Damien Martyn: 'England are fired up again, just like in 2005...'

Australian veteran of that Ashes series, believes the hosts' may become unstoppable if they win the first Test
Tour de France 2015: Twins Simon and Adam Yates have a mountain to climb during Tour of duty

Twins have a mountain to climb during Tour of duty

Yates brothers will target the steepest sections in bid to win a stage in France
John Palmer: 'Goldfinger' of British crime was murdered, say police

Murder of the Brink’s-MAT mastermind

'Goldfinger' of British crime's life ended in a blaze of bullets, say police
Forget little green men - aliens will look like humans, says Cambridge University evolution expert

Forget little green men

Leading evolutionary biologist says aliens will look like humans
The Real Stories of Migrant Britain: An Algerian scientist adjusts to life working in a kebab shop

The Real Stories of Migrant Britain

An Algerian scientist struggles to adjust to her new life working in a Scottish kebab shop
Bodyworlds museum: Dr Gunther von Hagens has battled legal threats, Parkinson's disease, and the threat of bankruptcy

Dying dream of Doctor Death

Dr Gunther von Hagens has battled legal threats, Parkinson's disease, and the threat of bankruptcy