Market report: Monday close

By MICKEY CLARK FOR MAILONLINE
Updated:

 

BRITAIN'S biggest company, HSBC, continues to attract fans even though the shares have soared by almost 50% this year.

Today, the price dipped 9p to 902p against a low of 631p in February, and the company now boasts a price tag of almost £100bn.

Two brokers have upgraded their recommendations. US securities house Lehman Brothers moved from equal weight to overweight, raising its 12-month target price from 825p to 975p. Merrill Lynch upgraded from neutral to outright buy with a target of 1013p and has raised its earnings forecast by 4% for this year and by 9% for 2004.

HSBC has expanded rapidly. Only a couple of weeks ago it agreed to pay $1.3bn (£776m) for Bank of Bermuda, and earlier this year bought Household Finance Corporation of the US. Lehman says it upgraded after making bigger assumptions of the contribution from Hong Kong and the benefits likely from Household.

While the main banking division continues to fire on all cylinders, there are concerns about the investment banking unit, where HSBC is reckoned to have laid off 90 more workers last week.

Share prices generally were in retreat, undermined by opening losses for the Dow in New York this afternoon. The FTSE 100 index finished down 35.1 to 4341.8.

AstraZeneca dropped 86p to 2681p ahead of the publication of the result of trials of its bloodthinning treatment Exanta by US authorities tomorrow.

Broker UBS is confident Exanta will be approved next year by the US Food and Drug Administration for the treatment of thrombosis.

Fund manager Amvescap fell 9 1/2p to 408p after it was confirmed US regulators are probing accusations of stock-market abuse.

Hedge fund firm Man Group fell 5p to 1465p as investors reflected on last week's interim profits. The fall in the price discounted a move by Lehman Brothers to raise its target from 1660p to 1850p. Lehman said it had revised its forecast to reflect a slower rate of decline in revenue margins.

Shares in London Stock Exchange fell 5 1/2p further to 357 1/2p. It emerged last week that the Office of Fair Trading is conducting an inquiry into the pricing arrangements for companies quoted in London.

Bid speculation helped drive Psion 8p higher to 83 1/2p, making it the best performer among secondliners. There is talk that Psion may soon receive a bid from Nokia of Finland, which is said to want control of Symbian, a mobilephones operating system joint venture in which Psion and Nokia have the biggest stakes.

AIM-listed soccer club Charlton Athletic stayed at a year's low of 18 1/2p despite Saturday's 3-1 win over Premiership rival Fulham, putting Charlton into fourth place in the league.

It was the first day on AIM for Clapham House Group following a placing at 100p. The company was founded by David Page, former chief executive of Pizza Express, to invest in small restaurant chains. It touched 120 1/2p before settling at 112 1/2p.

3DM Worldwide jumped 26p to 164 1/2p on excitement at prospects for its new toughened plastics procedure.

Engineer Tomkins slipped 2 1/2p to 286p. Broker UBS remains neutral on the shares but has raised its target price from 255p to 300p.

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