Rumours surround Zeneca as Footsie drifts along; MARKET REPORT

Zeneca is back in the stock market limelight. As blue chips took a breather after their heroics, attention was directed towards the drugs group, for long a favoured takeover target.

It could have been because the heady excitement of the past two days suddenly evaporated and some of the more astute players found themselves with time on their hands.

So they alighted on Zeneca, which after some rip-roaring sessions has been surprisingly free from speculation in the past few months.

Two related stories emerged. The most widely rumoured was that Roche, the Swiss drugs giant for long seen as a likely predator, had blocked its corporate staff from taking holidays for the next two months. Such a development, ran the argument, could mean a long-suspected Zeneca bid was on.

Whether the holidays story was true or not the other leg of the yarn was much more relevant. JP Morgan, the US investment house, upgraded its Roche profit forecasts, prompting some US investors to buy into Zeneca. It was enough to lift the shares 37.5p at one time before a little profit taking clipped the gain to 29.5p at 1,653.5p.

Most blue chips were forced to play second fiddle as second and third liners took up the stock market running.

As Footsie drifted, ending 9.3 points lower, supporting shares moved ahead with the FTSE 250 index briefly reaching, for the first time since April, a new trading peak.

The leaders were unsettled by the flow of negative forecasts for shares in New York. Merrill Lynch's Robert Farrell is the latest prophet of gloom, predicting up to a 30 per cent decline this year.

The Ken and Eddie meeting created uncertainty and the gyrations of the Dow Jones Average did not help sentiment.

Even so, in early trading Footsie got to within hailing distance of 4,200, closing at 4,158.9.

Standard Chartered, the banking group, was the best- performing blue chip, up 33p at 744.5p, with SBC Warburg expressing confidence.

Schroders, the investment group, overcame NatWest Securities caution, with the ordinary shares 25p higher at 1,625p and the non voters 27.5p to 1,472.5p.

NatWest lifted its profit forecasts from pounds 223m to pounds 240m and from pounds 190m to pounds 236m. But analysts Rachel Lucas fretted about the increasing cost base as Schroders expanded its operations: "The risks to the business are building and the group is vulnerable to any setback in the extremely favourable conditions which it has enjoyed over the last two years."

Lehman Brothers lowered its Abbey National rating to underperform, clipping the shares 4.5p to 796p and sent out a buy signal for HSBC, up 40.5p to 1,426p.

British Steel and BT were actively traded, partly on bed and breakfast deals but also reflecting a technical position which encouraged market makers to borrow stock. Steel, following a positive analysts meeting, gained 4p to 150.75p and BT was 1.5p firmer at 416p, a 12-month high.

Sterling's strength continued to take its toll with Rolls-Royce, Wolseley and GKN leading the retreat.

Christies International rose 5.5p to a 265p peak. The auctioneer recently produced strong sales figures; the hovering presence of Joseph Lewis, the Bahamas multi-millionaire with approaching 30 per cent of the capital is another influence. English National Investment, controlled by Mr Lewis, put on 11.5p to 122.5p.

Prism Rail, meeting analysts next month, steamed ahead another 30p to 520p and GB Railways made further progress, up 25p at 267.5p.

Doeflex, the chemical group, rose 5p to 291.5p following meetings with analysts. Flying Flowers, figures next month, rose 5p to 207.5p.

Lanica, Andrew Regan's vehicle, fell 125p to 1,550p. After the market closed it produced a long-awaited statement. It said it was "not aware of any reasons for the substantial increase" in its shares in recent months and as an investment company could not invest more than 20 per cent of its assets in any one situation. As its shares moved from 58p to 2,050p such a statement would have been useful. The price has retreated in the past few weeks

A few car dealers moved up a gear on hopes of an improved deal from Ford; and waters and the remaining electricity distributors gathered support from Credit Lyonnais Laing.

Warburg said switch from National Power to PowerGen; advice which left NP 1p lower at 500p and PG 4.5p brighter at 620.5p.

Start your day with The Independent, sign up for daily news emails
PROMOTED VIDEO
News
Starting the day with a three-egg omelette could make people more charitable, according to new research
science
News
Top Gun actor Val Kilmer lost his small claims court battle in Van Nuys with the landlord of his Malibu mansion to get back his deposit after wallpapering over the kitchen cabinets
people
News
Comedian Ted Robbins collapsed on stage during a performance of Phoenix Nights Live at Manchester Arena (Rex)
people
News
The actress Geraldine McEwan was perhaps best known for playing Agatha Christie's detective, Miss Marple (Rex)
peopleShe won a Bafta in 1991 for her role in Oranges Are Not The Only Fruit
News
newsPatrick Cockburn was able to update his agenda-setting 'The Rise of Islamic State' while under attack in Baghdad
News
Robert Fraser, aka Groovy Bob
peopleA new show honours Robert Fraser, one of the era's forgotten players
Life and Style
Torsten Sherwood's Noook is a simple construction toy for creating mini-architecture
tech
Sport
David Silva celebrates with Sergio Aguero after equalising against Chelsea
footballChelsea 1 Manchester City 1
ebooks
ebooksA special investigation by Andy McSmith
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: Software Development Manager

£40000 - £50000 per annum: Recruitment Genius: This is an exciting opportunity...

Ashdown Group: Product Manager - (Product Marketing, Financial Services)

£30000 - £35000 per annum + Benefits: Ashdown Group: Marketing Manager - Marke...

Recruitment Genius: Compliance Assistant

£13000 per annum: Recruitment Genius: This Pension Specialist was established ...

Ashdown Group: Market Research Executive

£23000 - £26000 per annum + Benefits: Ashdown Group: Market Research Executive...

Day In a Page

As in 1942, Germany must show restraint over Greece

As in 1942, Germany must show restraint over Greece

Mussolini tried to warn his ally of the danger of bringing the country to its knees. So should we, says Patrick Cockburn
Britain's widening poverty gap should be causing outrage at the start of the election campaign

The short stroll that should be our walk of shame

Courting the global elite has failed to benefit Britain, as the vast disparity in wealth on display in the capital shows
Homeless Veterans appeal: The rise of the working poor: when having a job cannot prevent poverty

Homeless Veterans appeal

The rise of the working poor: when having a job cannot prevent poverty
Prince Charles the saviour of the nation? A new book highlights concerns about how political he will be when he eventually becomes king

Prince Charles the saviour of the nation?

A new book highlights concerns about how political he will be when he eventually becomes king
How books can defeat Isis: Patrick Cockburn was able to update his agenda-setting 'The Rise of Islamic State' while under attack in Baghdad

How books can defeat Isis

Patrick Cockburn was able to update his agenda-setting 'The Rise of Islamic State' while under attack in Baghdad
Judith Hackitt: The myths of elf 'n' safety

Judith Hackitt: The myths of elf 'n' safety

She may be in charge of minimising our risks of injury, but the chair of the Health and Safety Executive still wants children to be able to hurt themselves
The open loathing between Barack Obama and Benjamin Netanyahu just got worse

The open loathing between Obama and Netanyahu just got worse

The Israeli PM's relationship with the Obama has always been chilly, but going over the President's head on Iran will do him no favours, says Rupert Cornwell
French chefs get 'le huff' as nation slips down global cuisine rankings

French chefs get 'le huff' as nation slips down global cuisine rankings

Fury at British best restaurants survey sees French magazine produce a rival list
Star choreographer Matthew Bourne gives young carers a chance to perform at Sadler's Wells

Young carers to make dance debut

What happened when superstar choreographer Matthew Bourne encouraged 27 teenage carers to think about themselves for once?
Design Council's 70th anniversary: Four of the most intriguing prototypes from Ones to Watch

Design Council's 70th anniversary

Four of the most intriguing prototypes from Ones to Watch
Dame Harriet Walter: The actress on learning what it is to age, plastic surgery, and her unease at being honoured by the establishment

Dame Harriet Walter interview

The actress on learning what it is to age, plastic surgery, and her unease at being honoured by the establishment
Art should not be a slave to the ideas driving it

Art should not be a slave to the ideas driving it

Critics of Tom Stoppard's new play seem to agree that cerebral can never trump character, says DJ Taylor
Bill Granger recipes: Our chef's winter salads will make you feel energised through February

Bill Granger's winter salads

Salads aren't just a bit on the side, says our chef - their crunch, colour and natural goodness are perfect for a midwinter pick-me-up
England vs Wales: Cool head George Ford ready to put out dragon fire

George Ford: Cool head ready to put out dragon fire

No 10’s calmness under pressure will be key for England in Cardiff
Michael Calvin: Time for Old Firm to put aside bigotry and forge new links

Michael Calvin's Last Word

Time for Old Firm to put aside bigotry and forge new links