Market Report: Bid talk helps Tui Travel to enjoy its day in the sun

The blue-chip index may have closed last night at its lowest level for nearly three months, but Tui Travel was sunning itself at the top of the leaderboard following renewed speculation the tour operator could be in line for an approach.

Its parent company Tui AG has long been believed to be interested in acquiring the 44.9 per cent of Tui Travel it does not own, and yesterday vague rumours returned that the German group was mulling a potential bid.

With the chatter suggesting it may offer up to £4 a pop for the remaining shares, the catalyst – said market gossips – was the fact that Tui Travel has lost more than a fifth of its share price since January. Yesterday, however, it put on 3.8p to finish at 215.1p, with the group also helped by the falling price of oil.

Overall, the FTSE 100 shifted down 60.58 points to 5,742.55 after jobless claims in the UK soared and fears continued to grow over the chances of a bailout agreement being reached for Greece. The banks were among the worst hit with Barclays and Lloyds Banking Group retreating 7.15p to 257.4p and 0.86p to 47.69p respectively, as the Chancellor, George Osborne, said he supported the ring-fencing of their retail operations.

Glencore's week went from bad to worse after the commodities trader dropped 27p to 473p, a new low. The group, which floated last month at 530p, made the move after confirming its comments on Tuesday that it was "not actively considering" an approach for Eurasian Natural Resources – down 17.5p to 744p – and it noted that takeover rules meant it was now unable to make a bid for six months.

Burberry stayed steady at 1,320p as chatter continued to spread that the luxury brand may be in line for an approach, while vague takeover talk around both Whitbread – up 9p to 1,536p – and Smith & Nephew – up 1.5p to 657p – also made a brief return.

The break-up potential of Smiths was once again under discussion, as City scribblers said investors' recent pessimism was misplaced. The engineering group's share price has long been supported by hopes it could dispose of one of its five units, yet since rejecting a £2.45bn offer for its medical services business in January it has lost over 12 per cent of its share price.

UBS, however, said concerns about whether Smiths is willing to sell or not were "overdone", saying that there was "no rationale to the... businesses being together". However, despite the analyst's warning that "to be out of the stock in the next 12 months could be a lost opportunity", Smiths still eased back 6p to 1,123p.

Fears it could soon face tighter regulations in the US knocked Experian back 15.5p to 785p, despite Shore Capital's Robin Speakman doing his best to calm the market's nerves. Although the analyst said such a move did seem likely, he added that "[regulatory change] should be as much welcomed as feared as it may also provide opportunity for growth and development."

British Land gained 2.5p to 591.5p after an attempt to prevent its planned construction of a new European headquarters for UBS was denied. English Heritage had hoped the City location would be classified as a heritage site, but the Department for Culture, Media and Sport refused the request.

J Sainsbury eased back by 3.2p to 323.6p as the supermarket saw its underlying sales in the UK rise by 1.9 per cent, just below the market's forecast. The group's update came a day after Tesco released its latest figures, with its rival – down 2.95p to 404.35p – missing expectations as well.

GlaxoSmithKline (GSK) narrowly failed to stay in the blue, slipping back 1p to 1,287p, after the publication of a study on its rival Pfizer's Spiriva Respimat inhaler. The analysis on the US company's product found it may increase the risk of death, and Panmure Gordon's Savvas Neophytou said the news might help GSK's Advair drug, adding "any benefit... could compensate for increased competition from generics in [its non-US] markets".

Down on the FTSE 250, Marston's was raising a pint to Royal Bank of Scotland after the broker initiated coverage on the pubs group with a "buy" recommendation. Saying its "'keep it simple' strategy suits the current environment", RBS's analysts added that Marston's "trading looks resilient, growth plans sustainable and we believe investment returns are now improving."

The City scribblers were not so positive on ITE Group, however, as the conference organiser slid 16.3p to 222p. Investec's Steve Liechti was the man behind the fall after changing his recommendation to "hold" from "buy", noting fears over new competition to its key Mosbuild event in Moscow.

It was plain sailing for YCO on the Alternative Investment Market as the company revealed it had agreed to a contract to build a superyacht, leaving it 2.25p better off at 14.25p.

Elsewhere, the small-cap retailer Game was knocked back 6.5p to 38.75p after announcing its sales had dropped by more than 11 per cent.

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