Yesterday's trading: Punters gamble on PartyGaming

By Geoff Foster for MailOnline
Updated: 02:22 EDT, 22 February 2007

The online gaming massacre of 2006 saw £6.5bn wiped off the sector's value. The US clampdown on internet gambling sparked an avalanche of selling which left thousands of investors, big and small, nursing hefty losses.

They have since given the industry the bargepole treatment, preferring safer havens. Until yesterday, that is.

Various rumours prompted a flurry of speculative buying in PartyGaming which lifted the shares to 45¼p before closing 4¼p higher at 41½p.

Brave buyers piled in amid reports that veteran Congressman Barney Frank, Democrat chairman of the House Financial Services Committee, wants to repeal the gambling ruling and has called for a two-year amnesty. Last March, Frank said: 'Adults are entitled to do with their money what they want to do.'

Other stimulants included very vague takeover talk and gossip that full-year figures on March 1 will easily exceed expectations.

It was the September arrest in the US of Sportingbet's former chairman Peter Dicks that preceded the sector's collapse and led to £1bn being slashed from its value. The group had to flog its US gaming division for a token dollar.

The merest hint of a US reprieve saw a welcome recovery which left the stock 5p better at 40p on hefty turnover of 13.8m, well up on Tuesday's mediocre 983,000. 888 Holdings, still waiting for Ladbrokes to pounce, firmed 1½p to 111½p.

All bets were off at Ladbrokes as the betting shops group succumbed to nervous selling ahead of today's results to finish 11¼p cheaper at 441½p.

A trading statement in November highlighted the weakness in second-half trading where gross win was barely growing and operating profits declined by around 6pc between July and October.

The Footsie extended earlier losses to finish 55.2 points off at 6,357.1, making a two-day loss of 87.1 points. Fund managers trousered profits on seeing Wall Street drop 79.4 points in the early stages after January's higher than expected gains in consumer prices fuelled concerns that inflation pressures will prevent the Fed from reducing US interest rates later this year.

Mobile phone giant Vodafone, 3½p down at 147p, accounted for more than ten points of the Footsie's fall after a Morgan Stanley downgrade. The US broker slashed its 2008 operating profit forecast by 10% to £12.4bn.

A Spanish newspaper report that Philip Morris is considering making a bid for the UK tobacco giant puffed punters into Imperial Tobacco for the umpteenth time in recent weeks. The shares touched 2246p and closed 40p up at £22.

El Economista said that Altria's Philip Morris unit has contacted investment banks to see if Altadis would add its considerable weight behind a takeover of Imps.

A Kepler, Teather & Greenwood earnings upgrade helped bus and rail group Go Ahead accelerate 69p to 2396p.

The subject of vague private equity bid speculation, department store Debenhams rose 3¾p to 164¾p on turnover of 23m. Panmure Gordon's Philip Dorgan upgraded to buy from sell and raised his target price to 190p from 170p. Debenhams reports a pre-close trading statement on March 16. Don't expect fireworks but the bad news is in the price.

Fading bid hopes left pubs and restaurants group Mitchells & Butlers 17p lower at 745p.

Housebuilder Ben Bailey climbed 51p to 688½p on confirmation the board is considering the sale of the company.

The appointment of former Harley-Davidson vice president John Russell as group chief executive helped black cab maker Manganese Bronze gain a further 23p to a record 785p.

Dog of the day was Continuum Payment Solutions which crashed 46½p in a nominal market to 28½p on the board's plan to seek shareholders approval to cancel its ordinary shares from trading on AIM.

Inion, the Finnish medical technology company, rose 2½p to 31p following US approval of its latest biodegradable medical implant product for fixing fractures and osteotomies in the entire body.

Air conditioning installer Worthington Nicholls, floated at 50p in June, jumped 9p more to 161½p. It has signed an agreement with Q2 Solutions, an Australian software specialist, to act as preferred service provider to install and maintain Q2's software solution to 197 Intercontinental Hotel group brand hotels in Europe, the Middle East and Africa.