Thin turnover as skeleton staff rattle around the City


Shares flirted with a new closing high but lost their festive blush in the bizarre trading conditions which are bound to prevail on a day sandwiched between the Christmas holiday and the weekend.

Not many City men trundled into their offices. Most firms were content to operate with skeleton staffs and the lack of interest of the securities industry and the investing public in the half-day session was demonstrated by the exceedingly thin turnover.

Footsie ended 1.5 points lower at 4,091 after touching a trading high of 4,102.9. The early flourish was little more than a knee-jerk reaction to a sound overnight display by the Dow Jones Average.

Interest rate worries were cited as the prime influence behind the stock market's hesitancy. Many observers expect increases on both sides of the Atlantic in the new year.

BT had the distinction of leading the blue chips with a 6p gain to 405p. The high volume of festive calls seemed to be the immediate reason. However BT has been dialling some interesting gains as the market, after early hesitancy, has become increasing receptive to the proposed takeover of MCI, the US giant.

The new charges for mobile telephones and BT's involvement in digital broadcasting have also helped offset the unrelentingly tough stance of the industry regulator. The shares are riding at their highest point for nearly 18 months, having fallen to 326.5p.

Among other blue chips BTR continued its revival, up 3.5p to 273.5p, and Allied Domecq, on the rumoured Lehman Brothers buy advice, put on another 2.5p to 452.5p.

The debate about Christmas trading moved in favour of the more optimistic souls as the John Lewis Partnership offered support to the view that retailers have enjoyed a bumper time.

JLP said sales in the week ending 14 December were up 5.1 per cent on last year and weekly department store sales a record 5.9 per cent higher.

The company expects to beat such a performance by a "substantial margin" in the last full pre-Christmas week.

The JLP evidence helped to ease concerns which have arisen over festive trading. There has been evidence from some quarters that the sales volume has faltered in the last stage of the run in. But with JLP so positive Dixons gained 5.5p to 529.5p and Next 4.5p to 554p.

Blacks Leisure, the leisure wear retailer, consolidated its position as the year's top performing share. The price improved 6p to 350.5p, lifting the percentage gain to around 600 per cent. JJB Sports jumped 26p to 290p.

The threat of increased mail order competition took the shine from Great Universal Stores. It gave up 8.5p to 606.5p. Sears, which is near to unloading its Freemans mail order side, possibly to Littlewoods, rose 1p to 91p.

Oils produced a smattering of modest gains, largely on hopes of further takeover excitement. The end of the Northern Electric takeover battle left the distributors shares up 9p at 646p. Northern is replaced in the FTSE 250 index by Mayflower Corporation, a car bodies maker and vehicle conversions group. The two remaining electrical distributors moved ahead as they awaited what is seen as the inevitable takeover strike. Southern put on 5.5p to 784p and Yorkshire 6p to 808.5p.

Burnfield, expected to surrender to the improved Fairey bid, rose 11.5p to 153.5p. Fairey, riding at 697p in the summer, fell a further 18.5p to 582.5p.

Scottish Pride, a dairy group, jumped 15p to 57.5p as the Department of Trade and Industry gave qualified clearance to a bid from their bigger rivals Robert Wiseman. The merger creates a business with around 80 per cent of the Scottish milk market.

Two computer groups seen as beneficiaries of the millennium computer changeover made headway. DCS improved 22p to 262.5p and Delphi 12.5p to 712.5p. Micro Focus rose 55p to 955p.

Bodycote International, once big in textiles and now a safety products and packaging group, added 25p to 820p, a peak. The strength stemmed from the success of a pounds 115.5m rights issue. The company, which became disillusioned with the textile industry in 1989, is taking over Brukens of Sweden, one of the largest heat treatment groups on the Continent with 27 plants.

Premier Farnell, the electronic components group, continued to benefit from a planned US sale which should raise $300m. The shares improved 10p to 749.5p. They have risen 37p since the disposal was announced last week and are now at their peak.

Taking Stock

The behaviour of Lehman Brothers, the US securities house, over Acorn Computer is intriguing. In its capacity as a market-maker it has declared a 12.98 per cent share holding, down from 13.5 per cent on Monday.

Olivetti, the struggling Italian group, has 31.2 per cent and there is speculation it wants to get out.

It is unusual for a market-maker to take such a large stake on its books and Lehman's action could herald corporate developments with possibly a US strike. Acorn held at 195.5p.

Shares of Taylor Nelson, the research group, rose 7.25p to 54.5p, back to their level before a surprise profit warning.

The price fell to around 40p after the warning but has since reclaimed the lost ground on steady buying.

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