Market Report: Talk of Havas bid for Aegis has dealers excited

More than 73 million shares changed hands, nearly five times the volume of an average day, as traders clamoured to get on board the stock in the hope of making a quick turn. Along with Havas, the US advertising giant Omnicom was also mentioned as a possible buyer of the company. However, media analysts were less than optimistic about the prospect of a bid for Aegis. They noted that Aegis has been talked of as a takeover target for many years and that nothing has emerged to date. Both Havas and Aegis refused to comment.

Meanwhile, Havas unveiled forecast-busting second quarter results, which buoyed sentiment towards the advertising sector. The FTSE 100 index continued its march higher, gaining 4 points to 5,332, while the FTSE 250 registered an altogether more impressive 38-point jump to finish at 7,675.

Corus ticked 0.25p higher to 47.5p as Credit Suisse First Boston tipped steel prices to start to recover over the next six months. The Swiss broker said: "There are now visible signs that the steel market will recover on a 3-6 month view." Somerfield continued to edge higher, improving 0.25p to 202.25p, which prompted talk that a formal offer for the company from Apax may soon be on the way. Bulls of the stock hope that such a move by Apax will flush out further private equity offers and maybe even spark a bidding war for the convenience store operator.

GCap Media fell 2.75p to 295.75p while Emap lost 7p to 846p as investors were unsettled to hear that BskyB is launching a new portable wireless device (called Sky Gnome) that will enable its customers to listen to audio output from their favourite digital and radio channels throughout the home. This development is bad news for commercial radio groups such as GCap and Emap, say analysts. They note that 70 per cent of commercial radio listening in the UK happens in the home and that an increasing proportion of this is happening through the TV set rather than the traditional radio.

Credit Suisse First Boston believes that Sky's innovation will at the very least hasten the fragmentation of the UK radio market. At the very worst, it will allow the satellite broadcaster to break the distribution monopoly currently enjoyed by commercial radio operators, warns the Swiss broker.

In the world of small-caps, Asia Energy put on 40p to 635p after the coal miner was heard to have made a bullish presentation to analyst at Numis Securities. Tanzanite One jumped 11p to 95.5p after the miner boasted of having discovered the world's largest piece of tanzanite at its site in the north of Tanzania. The rock weighs more than 3 kilograms. However, the company was unwilling to put a value on it at this stage.

Asian Citrus became the biggest Chinese company to list on AIM this year. The orange grower, which has two plantations the size of Guernsey, raised £12m at 112p. Asia Citrus will use the cash to expand and further develop its existing operations. It saw its stock close at 115.5p, valuing the company at £70m. SPG Media added 0.25p to 6.62p after Stephen Davidson, its chairman, disclosed the purchase of 150,000 shares at 6.38p.

IFX Group jumped 11p to 122.5p as brokers highlighted the company's modest valuation. After stripping out its £17m cash pile, the stock market values IFX, which owns spreadbetting firm Finspreads, at less than £20m. However, only a few months ago, rival spreadbetting firm IG Group floated in London with a market value of nearly half a billion pounds.

Brokers believe that although Finspreads is a smaller-scale operation than IG, it is not so much smaller so as to justify the huge difference in valuation. IFX, which also has a foreign exchange dealing business, has in the past been on the receiving end of several takeover approaches. A fresh offer for the company would not be a surprise, say brokers.

Libra Natural Resources, off 0.25p to 7.37p, indicated that it is in talks aimed at selling its interest in King Coal to Coal International, 1p lower at 90p. Libra paid less than $1m for its 3 per cent in interest in King Coal, a private company, and analysts expect the group to register a significant profit once the sale is complete. Cambrian Mining, 9.5p higher at 164.5p, is King Coal's biggest shareholder.