Rights rumours spark roller-coaster ride

MARKET REPORT

NICHOLAS SCHOON

Rights rumours spark

roller-coaster ride

The FT-SE 100 index rose 10.8 points to 3,135 and the FT-SE 250 index 15.7 to 3,406.7. Turnover was 922.3 million shares. Government stocks were firm.

Cash call rumours helped to unsettle shares. In a roller-coaster session the FT-SE 100 index swung from a 24.6-point gain to a 0.8 fall before closing 10.8 higher at 3,135.

Trading was the busiest this year with turnover comfortably exceeding 900 million shares and 37,267 bargains.

Tax-effective bed and breakfast deals contributed but there was evidence of big programme trades with one exercise, spread over two days, thought to be the largest for some time.

Rolls-Royce was the main cash call candidate. There was talk it was about to tap the stock market for around £300m to help pay for acquiring the US aero engine maker, Allison.

It has made no secret of its plans to raise cash. Many expected it to make its demands known when it announced its yearly figures earlier this month. The debate has centred on whether it will resort to a straightforward rights issue or go for a share placing.

A placing would be more helpful to Rolls' US investors, which would have difficulty subscribing for rights shares.

Henderson Crosthwaite believes Rolls will offer shares at 145p on a one- for-five ration.

Helped by a $15m Bolivian power station order the shares at one time touched 167p. But talk of the nearness of the cash call restrained enthusiam and the shares closed at 164.5p, up 2.5p, in busy trading.

Another likely to call upon shareholders is Scottish & Newcastle. It is expected to finance its proposed £500m takeover of the Courage brewing group with a rights issue. Scottish shares rose 8p to 506p.

Both have sought cash from shareholders in recent years. Rolls called for £307m in September 1993. In the same month Scottish raised £405m to finance its takeover of the Chef & Brewer pubs chain.

Elsewhere the volatility stemmed partly from the behaviour of the futures market but another strong opening display by New York encouraged the late revival.

Since the bull run started eight trading days ago the index has soared by nearly 150.

Arjo Wiggins Appleton, as expected, missed the latest fun. Saint Louis, the French group, pushed the shares 10p down to 248p with its declaration it intends to stick with its 40 per cent shareholding.

Prudential Corporation fell 10.5p to 322p after results.

Legal & General dipped 5p to 476p on reports of City opposition, led by former cabinet minister Sir John Nott, to its plans to unlock "orphan" funds.

British Steel was another out in the cold. The shares dipped 5p to 159.5p with Seaq putting volume at nearly 26 million. NatWest Securities caution following price cuts by a US producer did the damage.

Among blue chips higher were BAT Industries (following a strong performance by Philip Morris shares), up 15p at 431p; Great Universal (hopes of a share buy-back), 15p to 569p, and Amersham International, 34p to 869p.

Nurdin & Peacock's retreat from discount warehouses lifted the shares 12p to 170p and Airtours, meeting analysts, rose 4p to 419p.

Transport Development Group, a particularly tight market, put on 8p to 215p as several stockbrokers attempted unsuccessfully to pick up stock.

Courtaulds Textiles continued its round of meetings, calling at SG Warburg. The shares rose 4p to 428p.

An upbeat trading statement lifted Hawtin, the mini-conglomerate, 2.5p to 29p. Halkin, the Ronson lighters group, improved 4p to 67p after it announced figures and a £10m package of acquisitions. Its buying spree has netted a sales promotion company, wholesalers of cosmetics and jewellery and a packaging business.

There was busy trading in the shares with Modus Vivendi, its fifth largest shareholder, selling its 7.89 per cent stake.

Signet, the old Ratners jewellery chain, rose 1p to 16.5p as US shareholders led a campaign to call a shareholders meeting. Behind the request is the failure of Signet to sell its US jewellery shops chain.

Guinness, with figures tomorrow, edged ahead 2p to 421p. Around £900m is expected. But there are hopes the brew will be strengthened with news of a share buy-back.

Blenheim, the conference and exhibition group, slipped 4p to 174p. Year's results are expected today. The market is looking for a slump from £42.5m to nearer £30m.

Greycoat, the property group, edged forward 2p to 121p. Smith New Court described the group as a "unique recovery stock". Two rights issues and asset sales helped save Greycoat.

Profits are put at £3.5m this year, £5m next

Haemocell, the medical equipment group, edged ahead 2p to 21p.

The shares have been friendless since bearish stockbroker comments. But some look for favourable developments with trading continuing to improve.

Hampden, the Ulster do-it-yourself group at which J Sainsbury sits on a holding of nearly 30 per cent, was unchanged at 46p. The shares have been strong as losses were turned into profits. Panmure Gordon has raised its profit forecast for this year by £500,000 to £1.5m, with £1.8m pencilled in for next. Assets are a conservative 56p a share, including 7p cash.

Takeover speculation has faded at Wm Morrison, the supermarket chain. The group should reveal tomorrow that it is trading well, with profits likely to emerge at £118m against £97.8m. Store openings should have added 12 per cent to sales growth and up to 10 stores are due to open this year. The shares edged ahead 2p to 144p, just 5p from their 12-month high.

News
John Travolta is a qualified airline captain and employed the pilot with his company, Alto
people'That was the lowest I’d ever felt'
Life and Style
healthIt isn’t greasy. It doesn’t smell. And moreover, it costs nothing
News
i100

Other places that have held independence referendums
Life and Style
fashion

Olympic diver has made his modelling debut for Adidas

PROMOTED VIDEO
Arts and Entertainment
Blossoming love: Colin Firth as Stanley and Emma Stone as Sophie, in 'Magic in the Moonlight'
film

Actors star in Woody Allen's 'Magic in the Moonlight'

News
peopleThe Times of India said actress should treat it as a 'compliment'
Arts and Entertainment
Maxine Peake plays Hamlet at Manchester's Royal Exchange
theatreReview: Maxine Peake brings emotional ferocity to Shakespeare's starring part
News
London's New Year's Eve fireworks event is going to be ticketed this year for the first time at £10 a head
news

Revellers will have to pay to see New Year's Eve fireworks in London

News
news

Watch this commuter wage a one-man war against the Circle Line
Travel
travel

...and the perfect time to visit them

News
We are phenomenally good at recognising faces; the study showed that humans have been selected to be unique and easily recognisable
science

Human faces unique 'because we don't recognise each other by smell'

Property
Home body: Badger stays safe indoors
lifeShould we feel guilty about keeping cats inside?
News
ebooksAn unforgettable anthology of contemporary reportage
Sport
Jonas Gutierrez (r) competes with Yaya Toure (l)
football

Newcastle winger reveals he has testicular cancer - and is losing his trademark long hair as a result

News
A male driver reverses his Vauxhall Astra from a tow truck
news

Man's attempt to avoid being impounded heavily criticised

Life and Style
tech

Try putting that one on your Christmas list
Arts and Entertainment
While many films were released, few managed to match the success of James Bond blockbuster 'Skyfall'
filmsDaniel Craig believed to be donning skis as 007 for first time
Student
The Guildhall School of Music and Drama is to offer a BA degree in Performance and Creative Enterprise
student

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

Trainee Recruitment Consultant - Birmingham - Real Staffing

£18000 - £23000 per annum + Commission: SThree: Real Staffing are currently lo...

Recruitment Consultant - Soho - IT, Pharma, Public Sector

£20000 - £25000 per annum + OTE £35,000 first year: SThree: The SThree group i...

Sales Executive

£20 - 24k (Uncapped Commission - £35k Year 1 OTE): Guru Careers: We are seekin...

Payroll & Accounts Assistant

£20 - 24k + Benefits: Guru Careers: This is a great opportunity for an enthusi...

Day In a Page

Mystery of the Ground Zero wedding photo

A shot in the dark

Mystery of the wedding photo from Ground Zero
His life, the universe and everything

His life, the universe and everything

New biography sheds light on comic genius of Douglas Adams
Save us from small screen superheroes

Save us from small screen superheroes

Shows like Agents of S.H.I.E.L.D are little more than marketing tools
Reach for the skies

Reach for the skies

From pools to football pitches, rooftop living is looking up
These are the 12 best hotel spas in the UK

12 best hotel spas in the UK

Some hotels go all out on facilities; others stand out for the sheer quality of treatments
These Iranian-controlled Shia militias used to specialise in killing American soldiers. Now they are fighting Isis, backed up by US airstrikes

Widespread fear of Isis is producing strange bedfellows

Iranian-controlled Shia militias that used to kill American soldiers are now fighting Isis, helped by US airstrikes
Topshop goes part Athena poster, part last spring Prada

Topshop goes part Athena poster, part last spring Prada

Shoppers don't come to Topshop for the unique
How to make a Lego masterpiece

How to make a Lego masterpiece

Toy breaks out of the nursery and heads for the gallery
Meet the ‘Endies’ – city dwellers who are too poor to have fun

Meet the ‘Endies’ – city dwellers who are too poor to have fun

Urbanites are cursed with an acronym pointing to Employed but No Disposable Income or Savings
Paisley’s decision to make peace with IRA enemies might remind the Arabs of Sadat

Ian Paisley’s decision to make peace with his IRA enemies

His Save Ulster from Sodomy campaign would surely have been supported by many a Sunni imam
'She was a singer, a superstar, an addict, but to me, her mother, she is simply Amy'

'She was a singer, a superstar, an addict, but to me, her mother, she is simply Amy'

Exclusive extract from Janis Winehouse's poignant new memoir
Is this the role to win Cumberbatch an Oscar?

Is this the role to win Cumberbatch an Oscar?

The Imitation Game, film review
England and Roy Hodgson take a joint step towards redemption in Basel

England and Hodgson take a joint step towards redemption

Welbeck double puts England on the road to Euro 2016
Relatives fight over Vivian Maier’s rare photos

Relatives fight over Vivian Maier’s rare photos

Pictures removed from public view as courts decide ownership
‘Fashion has to be fun. It’s a big business, not a cure for cancer’

‘Fashion has to be fun. It’s a big business, not a cure for cancer’

Donatella Versace at New York Fashion Week