Thirsty investors take to the waters and here

MARKET REPORT The FT-SE 100 index slipped 4.8 points to 3,089.3 but the supporting FT- SE 250 index rose 6.9 to 3,374.5. Turnover was 697.7 million shares with 30,558 bargains. Gilts were lower.

With the Takeover Panel snuffing out any early hopes of a new Trafalgar House bid for Northern Electric, attention has switched to what has become the poor relations of the utility industry - waters.

Already Northumbrian Water is in the predatory sights of Crdit Lyonnaise Des Eaux and Yamaichi, the Japanese securities house, has raised the possibility of a US assault on Wessex Water, drifting along near its 12-month low.

Waste Management International, the UK arm of a US waste disposal giant, has 19.8 per cent of Wessex, a result of a joint waste services venture. With the French showing an increasing thirst for the water industry there is speculation that Wessex will attract a US strike.

Douglas Falconer, an analyst at Yamaichi, talks about the possibility of "a knock-out bid". He suggests an agreed offer would allow an existing standstill agreement to be bypassed and could deliver Wessex, up 5p to 279p, on a relatively cheap rating. He also indicates that Lyonnaise may not have sole negotiating rights with Northumbrian, putting forward Gnrale Des Eaux as a possible contender.

But Lyonnaise's desire may be stronger. It already has substantial water interests in this country, including North East Water. Its UK water-related operations produced profits of £46.3m in its last financial year.

The feeling there could be a rush of water bids helped the sector, for so long overshadowed by electricities, to make modest headway. But electricities were again depressed with Northern reflecting the fading bid hopes with a 54p fall to 727p. Manweb and Yorkshire were among others to give ground.

The rest of the stock market failed to build on recent strength and the FT-SE 100 index slipped 4.8 points to 3,089.3. In a roller-coaster session early gains were wiped out in the immediate wake of the expiry of the March options. A subsequent rally petered out.

Turnover was again encouraging, although many private client stockbrokers complained they were seeing little of the business. Once again, tax-efficient but low-margin bed-and-breakfast deals made a significant contribution to the day's activity.

More jittery currency trading was blissfully ignored by equities, but Government stocks felt the chilly impact, closing lower.

Tarmac, the building group, was busily traded, gaining 1p to 112p on talk of a German strike. The shares, firm on Thursday, are near their 12-month low.

Fisons, selling most of its research side, jumped 7p to 163p. The latest deal will pull in £202m, the same amount the group is collecting for its scientific instruments sale.

Building shares had a firm session, helped along by the growing confidence interest rates will not be forced higher. A hint of lower German rates provided additional encouragement. There was also talk that a leading building personality was buying shares because he had become convinced the industry was set for happier times. Among shares higher were Barratt Developments, Berkeley, Bryant and Tay Homes. Redrow was also strong, up 6p to 117p. The shares floated at 135p last year

BTR weakened 10p to 321.5p as Hoare Govett moved its recommendation from undervalued to hold. Courtaulds, the chemical group, felt the impact on downgrading, losing 11p to 441p. The group has met analysts this week and it is thought the reduced forecasts stem from higher raw material costs.

Tate & Lyle's celebration of its elevation to the FT-SE 100 index proved short-lived. Thursday's anticipatory gain was almost wiped out as the shares soured 11.5p to 428.5p.

BAA, the airports group, followed its pricing policy success with its dbut on the Australian share market. The shares responded with a 13p gain to 455p. An upbeat trading statement lifted engineer Siebe 16p to 545p.

Asda reached another 12 month high, up 1.25p to 73.25p. There is thought to be US buying after a transatlantic visit.

Takeover speculation returned to haunt Kleinwort Benson, up 24p to 614p. Etam dipped 9p to 196p as takeover hopes faded following the appointment of Stanley Lewis as chairman. He is head of Oceana which has 37.2 per cent of the fashion chain. Manchester United firmed to 125p following its deal with Trafford Park Estates to buy land to expand its Old Trafford Stadium.

Shares in PhoneLink jumped 26p to 202p after the company clinched a deal for BT to use its Tel-Me service. The link could be worth £2.25m to PhoneLink over the opening two years of the agreement. BT will sell Tel-Me - which allows users to access information via their personal computers - through its business channels. The shares have been as high as 440p. BT rose 2p to 376.5p.

Start your day with The Independent, sign up for daily news emails
News
ebooksAn unforgettable anthology of contemporary reportage
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: Digital Optimisation Executive - Marketing

£30000 - £35000 per annum: Recruitment Genius: The UK's fastest growing, multi...

Recruitment Genius: Financial Reporting Manager

£70000 - £90000 per annum: Recruitment Genius: A Financial Reporting Manager i...

Recruitment Genius: Payments Operations Assistant

£23000 - £25000 per annum: Recruitment Genius: They win lots of awards for the...

Recruitment Genius: Telephone Debt Negotiator

£13500 - £20000 per annum: Recruitment Genius: This nationwide enforcement com...

Day In a Page

Sepp Blatter resignation: The beginning of Fifa's long road to reform?

Does Blatter's departure mean Fifa will automatically clean up its act?

Don't bet on it, says Tom Peck
Charles Kennedy: The baby of the House who grew into a Lib Dem giant

The baby of the House who grew into a Lib Dem giant

Charles Kennedy was consistently a man of the centre-left, dedicated to social justice, but was also a champion of liberty and an opponent of the nanny-state, says Baroness Williams
Syria civil war: The harrowing testament of a five-year-old victim of this endless conflict

The harrowing testament of a five-year-old victim of Syria's endless civil war

Sahar Qanbar lost her mother and brother as civilians and government soldiers fought side by side after being surrounded by brutal Islamist fighters. Robert Fisk visited her
The future of songwriting: How streaming is changing everything we know about making music

The future of songwriting

How streaming is changing everything we know about making music
William Shemin and Henry Johnson: Jewish and black soldiers receive World War I Medal of Honor amid claims of discrimination

Recognition at last

Jewish and black soldiers who fought in WWI finally receive medals after claims of discrimination
Beating obesity: The new pacemaker which helps over-eaters

Beating obesity

The new pacemaker which helps over-eaters
9 best women's festival waterproofs

Ready for rain: 9 best women's festival waterproofs

These are the macs to keep your denim dry and your hair frizz-free(ish)
On your feet! Spending at least two hours a day standing reduces the risk of heart attacks, cancer and diabetes, according to new research

On your feet!

Spending half the day standing 'reduces risk of heart attacks and cancer'
Liverpool close in on Milner signing

Liverpool close in on Milner signing

Reds baulk at Christian Benteke £32.5m release clause
With scores of surgeries closing, what hope is there for the David Cameron's promise of 5,000 more GPs and a 24/7 NHS?

The big NHS question

Why are there so few new GPs when so many want to study medicine?
Big knickers are back: Thongs ain't what they used to be

Thongs ain't what they used to be

Big knickers are back
Thurston Moore interview

Thurston Moore interview

On living in London, Sonic Youth and musical memoirs
In full bloom

In full bloom

Floral print womenswear
From leading man to Elephant Man, Bradley Cooper is terrific

From leading man to Elephant Man

Bradley Cooper is terrific
In this the person to restore our trust in the banks?

In this the person to restore our trust in the banks?

Dame Colette Bowe - interview