Market report: Yesterday's trading

By Geoff Foster for MailOnline
Updated: 03:19 EDT, 24 October 2006

How ironic it would be if Nasdaq launched its long-awaited bid for the London Stock Exchange on the day it celebrates the 20th anniversary of Big Bang.

It was not only fixed commissions for brokers that were abolished on October 26, 1986, but more importantly, so was the exclusion of foreigners.

Such liberalisation has changed the City's landscape and now a threatening American 25.3% shareholder is in pole position to take over the City's much loved 300-year-old institution.

Growing speculation that Nasdaq's chief executive Bob Greifeld is ready to either pounce soon with a £13-plus a share bid, or strengthen his position by increasing the US techmarket's shareholding to 29.9p, saw shares of the LSE soar to 1303p before closing up 16p at a record 1278p, having seen a two-day leap of 44p.

Nasdaq would have to pay at least 1243p to add to its holding, the top price it paid for its 25.3% stake. Greifeld could also just sit tight and do nothing and wait until May when Nasdaq would then be allowed to make a lower offer.

The market is still waiting for LSE chief executive Clara 'Baldrick' Furse to come up with a cunning plan to save it from Nasdaq or any other predator's clutches.

Michael Spencer's inter-dealer broking giant Icap (unchanged at 520p) held tentative discussions with Furse & Co in September, but withdrew after balking at the exchange's expensive valuation. Spencer continues to keep a close eye on the situation.

Perennial takeover favourite and international bank Standard Chartered advanced to 1473p and closed 39p higher at 1464p. Buyers piled in behind a report that Dubai government investment agency Istithmar is looking to increase its stake to 20%. It earlier this month splashed out £530m on a 2.7% shareholding.

Another jackanory suggested that Singapore state-owned investment company Temasek, which bought 12% of Standard last year from the Tan Sri Khoo Teck Puat family, is gearing up to bid for the rest. Standard would provide a large Asian footprint for any bidder.

However, dealers have been waiting in vain for Standard to be bought ever since the infamous three white squires saved it from Lloyds Bank more than 20 years ago.

With attendance in dealing rooms affected by the half-term holidays, the volume of business was nothing to write home about.

The Footsie drifted for long periods before retrieving a 26-point deficit to trade that much higher after Wall Street jumped 101 points in early trading on hopes the Fed will tomorrow leave US interest rates unchanged. The London close was 10.9 points better at 6,166.1.

As the oil price slipped $1 to $58 a barrel amid speculation OPEC will fail to cut output as planned, British Airways climbed 13p to 462p on consideration of lower fuel costs. There was gossip too that it is on the verge of an agreement with unions over its burgeoning pension deficit. Discount airline easyJet added 9¼p at 511p.

Professional punters had a smile on their face after Premier Oil gushed 95p to £13 on the long-awaited news of a bid approach. Dealers say the take-out price could be nearer £16. Cairn Energy improved 15p to 1885p on hopes it attracts a bid before it has a chance to float off its Indian interests.

Replacement hips group Smith & Nephew rose 6¾p to 514p after Deutsche Bank lifted its target price to 575p to 510p. Buying was also accompanied by talk of a pending US acquisition.

Struggling Milletts outdoor clothing group Blacks Leisure soared 32½p points to 431p as almost a third of the equity changed hands. Dealers watched blocks of 7.2m and 5.2m shares go through on the ticker at 401p and speculated the large buyer is Mike Ashley, boss of the Sports World chain and owner of Lillywhites in Piccadilly, London.

After Wyevale Garden Centres terminated its supply contract with the company two years earlier than originally agreed, household goods group William Sinclair shed 3p to 64½p. Wyevale has invited the company to bid to regain the contract next year.

Messaging International rose 0.375p to 17/8p on an upbeat trading statement. Among several contract wins is one to supply the company's text-to-landline solution to Californian telecoms operator Boost Mobile.

Placed on Aim at 10p by broker Corporate Synergy, shares of LED International closed at 13½p after hefty turnover of 4.3m. The Hong-Kong based company specialises in LED screens and other LED products.

• Aim-listed International Brand Licensing eased ¼p to 23p, despite market gossip that it has renegotiated its exclusive Admiral UK licensing agreement with supermarket group Asda.

The new three-year deal for the sports brand is expected to give IBL revenues of around £250,000. It has also lined up Manchester-based clothing group Rajan to stock the brand, which could lead to additional revenues of £300,000.