Market report: Yesterday's trading
Watch out for the rally at Amvescap, a shade off at 543½p. Shares in the fund manager, which derives more than 50% of its earnings from North America, have been in the dog-house because of the dollar's sharp weakness and fears it could be about to fork out an arm and a leg on Putnam Investments, which has been up for sale by insurer Marsh & McLennan.
The auction for Putnam, one of the oldest mutual fund companies in the US, has been ongoing for weeks with three foreign bidders apparently in the frame.
Amvescap is said to be one, along with UniCredit of Italy and Power Corp of Canada. Analysts value Putnam at around £2bn and if the bids from interested parties do not match Marsh & McLennan's valuation, it could yet be taken off the market.
Word is Amvescap's shareholders will be heaving a sigh of relief later this week when the result of the auction is announced.
Amvescap, which already owns two fund groups in the US, AIM investments and Invesco, is believed to have walked away after pitching its offer too low.
With broker Bear Stearns saying the greenback is definitely not on the verge of a dramatic slump and its recent retreat has just been the 'technical' consequence of it breaking out of the narrow trading ranges that had strangled the market since May, Amvescap could be due a bounce. Morgan Stanley also says the current dollar weakness is temporary.
Heavyweight mining groups celebrated the Feast Day of Saint Barbara, the Patron Saint of Miners, recording big gains.
Xstrata, a Morgan Stanley tip, jumped 60p to 2386p, while Lonmin put on 76p to 3143p,
Rio Tinto 47p to 2759p and Antofagasta 11¾p to 506¾p. The Footsie rose 28.9 points to 6,050.4 with late inspiration coming from across the pond.
Wall Street jumped 75 points at the outset following news of Bank of New York's £8.1bn bid for rival Mellon Financial, which will create an asset management giant.
It helped take New York dealers' minds off the near-15% collapse in drugs giant Pfizer after it was forced to stop development of its most important new product, a cholesterol drug which was expected to replace Lipitor, the world's best selling remedy.
Cairn Energy gushed 43p to 2100p amid continuing speculation that ONGC will bid for its Rajasthan Indian assets ahead of next Monday's flotation of the business.
Premier Foods' well flagged £2bn merger with Mr Kipling group RHM (85½p higher at 357¼p) had hungry punters gorging themselves on other old takeover favourites in the food sector.
Not only were they particularly sweet on Cadbury Schweppes (10½p better at 528p) but they chased Northern Foods 3p higher to 111p.
Mobile phone giant Vodafone buzzed up 2½p to 135p after Credit Suisse upgraded to outperform from neutral.
Reflecting increased broadband and Premiership football competition from BT Vision, BSkyB dipped 5p to 520p.
Sellers caused fresh turbulence at BAE Systems, 6¼p down at 384½p. They ran for the exit on growing fears the defence group will lose its lucrative Eurofighter contract with Saudi Abrabia.
Stakebuilding rumours accompanied a 32½p rise to 870p in Quintain Estates, the Wembley and Greenwich property developer.
Veteran property guru Jack Petchey has been in and out of the stock like a fiddler's elbow over the years and could be dealing again. HMV, which rejected a tentative bid approach from Permira at 210p per share, rose 5p to 171p on a Corporate Synergy recommendation. The broker says the integration of Ottakar's is going well and the deal should hit the target of enhancing earnings in the current year. Profits will recover in 2007/8.
Sports Cafe, the loss-making sports bar group, in which chief executive William Balkou owns 25.8%, galloped 7¾p ahead to 45½p. The company revealed in September it had received a bid approach and the market is still awaiting further news. Hot rumours yesterday suggested an imminent cash offer in the region of 65p a share.
Buyers piled in to Griffin Mining (11½p better at 99¾p) after the AIM-listed zinc producer said it is upgrading the processing facilities at its Caijiaying mine in China following completion of a feasibility study.
The processing capacity is to be increased from just under 350,000 tons of ore per annum to almost 500,000 in 2007 and about 750,000 in 2008.
• Buying on consideration of its vast and rich property assets helped Pinewood Shepperton climb 7p to 211p. The group, which houses the famous Pinewood and Teddington film studios, still has new ITV boss Michael Grade as its chairman.
He sits on 1.35%. Shrewd investor SVG Capital last week bought a tranche of loose stock and is now the biggest shareholder, with about 13%. One to watch.
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