Stock market report: Monday close
Prudential was back in demand, the shares rising 3¾p to 288¾p today amid mounting speculation that its UK insurance business could be the first target of entrepreneur Clive Cowdery's investment vehicle Resolution.
Latest: Updates from the stock exchange
Word is Cowdery has already approached the insurer with a view to making an offer.
Curiously enough, the Pru along with Aviva and Legal & General are already three of Resolution's biggest shareholders, owning about 20% of the company between them.
Resolution raised a £660m war chest in December with the aim of buying and restructuring financial assets.
Last year, it came close to picking up a sizeable stake in Bradford & Bingley, which was later nationalised.
Today's rise in the Pru's shares extended Friday's strong run. But as one trader said: 'Last week, you couldn't give Pru shares away when they stood at 250p.'
Shares initially set about clawing back some of last week's hefty losses, but investors were unable to maintain the early pace.
The FTSE 100 saw its lead steadily whittled away, and was left nursing a loss of 38.3 points at 3850.7, having touched 3959.98.
Wall Street made a nervous start, the Dow extending last week's losses with a fall of 13.22 points to 7352.45.
Financials made much of the running after reports the US government may be about to take a 40% stake in Citigroup.
The UK Government is this week expected to create its own bad bank, which will provide a £500bn dumping ground for toxic assets.
Royal Bank of Scotland rose 1.9p to 21.2p amid claims it will soon be split into two divisions. Lloyds Banking Group put on ½p to 56.8p ahead of results on Friday.
Aviate Global reckons the shares could be worth up to 300p if the company is not fully nationalised - or nothing if it is.
Life assurer Friends Provident added 1.6p at 75.2p while rival Legal & General gained 1.8p at 36.6p.
On AIM, Indago Petroleum leapt 14p to 26½p after settling its Jebel Hafit joint venture insurance claim in Oman.
The claim relates to a blowout at the Al Jariya well a year ago. Its share of the payout will give it a cash balance of $38m (£26m).
ITV was down ½p at 24p ahead of results next month. Deutsche Bank expects profits to be well down, and the outlook for advertising to remain tough. It has cut its target from 25p to 22p.
Talk is also that ITV may try to tap shareholders for £300m. Meanwhile, BSkyB is still looking to reduce its near-18% stake following a ruling by the regulator.
United Utilities, 7p softer at 517p, has been a poor performer of late but Cazenove says the shares appear good value for money, and has raised its rating from underperform to in-line. The broker says UU has been the worst-performing UK utility stock, having dropped from 761p since last summer.
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Tomorrow's agenda
Fund manager Ashmore publishes its interim results tomorrow, which will offer insight into the state of emerging markets, its speciality. The results are not expected to be pretty. Analysts at Numis expect profits to be down, with the "appetite for emerging-market debt subdued".
The outlook from builder Redrow is also set to be gloomy as the recession continues to hit the housing market. The firm, which is offering incentives to try to entice buyers, publishes half-year results. Analysts anticipate debts will rise and further will be necessary.
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