Takeover talk and rate hopes produce another record

MARKET REPORT

Another day, another record. Inspired by takeover and lower interest rate hopes leading shares ended a remarkable week in ebullient form with the FT-SE 100 index up 16.1 points at 3,680.4. Except for a modest relapse on Budget day the index has made steady progress this week, gaining 56.4 points.

But the stock market is not quite such a happy place as the rip roaring index performance might suggest. Said one stockbroker: "98 per cent of this market is doing absolutely nothing; the other 2 per cent is going ballistic".

Certainly blue chips need interest rate cuts and at least one big takeover bid for support. The rates reduction should occur soon and, if the rumour mill was in form, the bid action should come early next week. GRE, the Guardian Royal Exchange insurance group, reasserted its position as the market's favourite victim.

The shares outperformed other blue chips, achieving a 22p gain to 292p in unusually busy trading. BAT Industries, facing increasing tobacco problems in the US, is regarded as the most likely to strike. The insurance group is seen as an ideal add-on to BAT's already extensive financial interests which include the Eagle Star insurance business. BAT shares were unchanged at 557.5p.

But a BAT strike is not the only story circulating. A defensive merger with Legal & General, also a rumoured target, is another continuing yarn; so is a get-together with the market's leading bank bid candidate, Standard Chartered. Suggestions the long rumoured Continental insurance bid is at last about to materialise lifted some other insurers, with Royal up 17p at 400p and General Accident 18p at 683p.

L&G was little changed at 694p; Standard, in a strong bank sector, rose a further 8p to 614p.

Other takeover favourites bounced higher, including Bank of Scotland, Royal Bank of Scotland and Asda, the supermarket chain.

Vickers, the engineering group embracing Rolls-Royce cars, was another in the bid frame with talk of a Continental strike creating the action. The shares purred 7p to 278p.

The biotech babes were again high on drugs. British Biotech, on its cancer drug, was traded at 2,625p overnight and touched 2,150p in morning trading on hopes of US buying. But the Americans failed to arrive and the shares closed at 1,675p, up 127p. There are expectations the group will produce encouraging progress reports on another drug over the weekend.

Proteus, the drug designer, rose 35p to 144p, as it announced the first of its signalled deals, an income-producing licence agreement with SmithKline Beecham. Celltech, results on Wednesday, gained 53p to 602p and newcomer Peptide Therapeutics put on a further 13p to 251p.

MAID, the on-line information group which has just achieved a US listing, headed the hi-tech brigade, spurting 39p to 274p as it put its 100 million pages of business information on to the Internet.

CMG, a computer software group, made a bright start; placed at 290p, the shares reached 339p.

But it was not all one way traffic. BSkyB was at one time up 27p as buyers chased shares in a narrow market. They banked on US buying following the company's inclusion in the internationally followed Morgan Stanley Capital Index and further support from the Endsleigh League deal.

But then the Office of Fair Trading intervened, deciding to review the satellite television group's sports coverage, presumably sparked off by the Endsleigh deal, and its relationship with cable channels.

In often frantic trading the shares slumped 51p and then staged a modest rally, closing 5.5p down at 428.5p.

Coal Investments was another casualty, crashing 21p to 35p. The shares were 119p earlier this year. CI has had to fix up new loan terms with its bankers and is preparing a rights issue, said to be at around 10p.

De La Rue, the paper and security printing group, tumbled a further 17p to 643p. The shares have crashed from a high of 1,052p this year. The group issued another profit warning this week and analysts are continuing to make negative noises.

Hanson is another to lose its appeal. Its latest results prompted a round of downgradings, lowering the shares 10.5p to 185p, lowest for three years.

Pearson jumped 33p to 682p with a brace of big buyers appearing towards the close, and Grand Metropolitan slipped 3p to 439p. Its ESOP sold 51.9 million shares to SBC Warburg which, with Cazenove, placed 15.8 million at around 431p.

Sport
Alexis Sanchez has completed a £35m move to Arsenal, the club have confirmed
sportGunners complete £35m signing of Barcelona forward
Voices
Poor teachers should be fearful of not getting pay rises or losing their job if they fail to perform, Steve Fairclough, headteacher of Abbotsholme School, suggested
voicesChris Sloggett explains why it has become an impossible career path
Sport
world cup 2014
Sport
Ray Whelan was arrested earlier this week
PROMOTED VIDEO
Arts and Entertainment
In a minor key: Keira Knightley in the lightweight 'Begin Again'
film
Arts and Entertainment
Celebrated children’s author Allan Ahlberg, best known for Each Peach Pear Plum
books
News
peopleIndian actress known as the 'Grand Old Lady of Bollywood' was 102
News
Wayne’s estate faces a claim for alleged copyright breaches
newsJohn Wayne's heirs duke it out with university over use of the late film star's nickname
Life and Style
It beggars belief: the homeless and hungry are weary, tortured, ghosts of people – with bodies contorted by imperceptible pain
lifeRough sleepers exist in every city. Hear the stories of those whose luck has run out
News
Mick Jagger performing at Glastonbury
people
Life and Style
fashionJ Crew introduces triple zero size to meet the Asia market demand
News
ebookA unique anthology of reporting and analysis of a crucial period of history
Sport
Santi Cazorla, Mikel Arteta and Mathieu Flamini of Arsenal launch the new Puma Arsenal kits at the Puma Store on Carnaby Street
sportMassive deal worth £150m over the next five years
Arts and Entertainment
Welsh opera singer Katherine Jenkins
musicHolyrood MPs 'staggered' at lack of Scottish artists performing
Life and Style
beautyBelgian fan lands L'Oreal campaign after being spotted at World Cup
Arts and Entertainment
Currently there is nothing to prevent all-male or all-female couples from competing against mixed sex partners at any of the country’s ballroom dancing events
Potential ban on same-sex partners in ballroom dancing competitions amounts to 'illegal discrimination'
News
business
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

Business Analyst Consultant (Financial Services)

£60000 - £75000 per annum: Harrington Starr: Business Analyst Consultant (Fina...

Systems Administrator - Linux / Unix / Windows / TCP/IP / SAN

£60000 per annum: Harrington Starr: A leading provider in investment managemen...

AVS, JVS Openlink Endur Developer

£600 - £700 per day: Harrington Starr: AVS, JVS Openlink Endur Developer JVS, ...

Technical Support Analyst (C++, Windows, Linux, Perl, Graduate)

£30000 per annum: Harrington Starr: A global leader in trading platforms and e...

Day In a Page

A History of the First World War in 100 Moments: Peace without magnanimity - the summit in a railway siding that ended the fighting

A History of the First World War in 100 Moments

Peace without magnanimity - the summit in a railway siding that ended the fighting
Scottish independence: How the Commonwealth Games could swing the vote

Scottish independence: How the Commonwealth Games could swing the vote

In the final part of our series, Chris Green arrives in Glasgow - a host city struggling to keep the politics out of its celebration of sport
Out in the cold: A writer spends a night on the streets and hears the stories of the homeless

A writer spends a night on the streets

Rough sleepers - the homeless, the destitute and the drunk - exist in every city. Will Nicoll meets those whose luck has run out
Striking new stations, high-speed links and (whisper it) better services - the UK's railways are entering a new golden age

UK's railways are entering a new golden age

New stations are opening across the country and our railways appear to be entering an era not seen in Britain since the early 1950s
Conchita Wurst becomes a 'bride' on the Paris catwalk - and proves there is life after Eurovision

Conchita becomes a 'bride' on Paris catwalk

Alexander Fury salutes the Eurovision Song Contest winner's latest triumph
Pétanque World Championship in Marseilles hit by

Pétanque 'world cup' hit by death threats

This year's most acrimonious sporting event took place in France, not Brazil. How did pétanque get so passionate?
Whelks are healthy, versatile and sustainable - so why did we stop eating them in the UK?

Why did we stop eating whelks?

Whelks were the Victorian equivalent of the donor kebab and our stocks are abundant. So why do we now export them all to the Far East?
10 best women's sunglasses

In the shade: 10 best women's sunglasses

From luxury bespoke eyewear to fun festival sunnies, we round up the shades to be seen in this summer
Germany vs Argentina World Cup 2014: Lionel Messi? Javier Mascherano is key for Argentina...

World Cup final: Messi? Mascherano is key for Argentina...

No 10 is always centre of attention but Barça team-mate is just as crucial to finalists’ hopes
Siobhan-Marie O’Connor: Swimmer knows she needs Glasgow joy on road to Rio

Siobhan-Marie O’Connor: Swimmer needs Glasgow joy on road to Rio

18-year-old says this month’s Commonwealth Games are a key staging post in her career before time slips away
The true Gaza back-story that the Israelis aren’t telling this week

The true Gaza back-story that the Israelis aren’t telling this week

A future Palestine state will have no borders and be an enclave within Israel, surrounded on all sides by Israeli-held territory, says Robert Fisk
A History of the First World War in 100 Moments: The German people demand an end to the fighting

A History of the First World War in 100 Moments

The German people demand an end to the fighting
New play by Oscar Wilde's grandson reveals what the Irish wit said at his trials

New play reveals what Oscar Wilde said at trials

For a century, what Wilde actually said at his trials was a mystery. But the recent discovery of shorthand notes changed that. Now his grandson Merlin Holland has turned them into a play
Can scientists save the world's sea life from

Can scientists save our sea life?

By the end of the century, the only living things left in our oceans could be plankton and jellyfish. Alex Renton meets the scientists who are trying to turn the tide
Richard III, Trafalgar Studios, review: Martin Freeman gives highly intelligent performance

Richard III review

Martin Freeman’s psychotic monarch is big on mockery but wanting in malice