Market report: Monday close

By PATRICK HOSKING
Updated:

 

STEELMAKER Corus has been one of the stars of the past four months. Brave souls who piled in at the bottom in March, when it seemed close to going bust, have more than quadrupled their money.

The shares received a fresh boost today, courtesy of the Franco-American battle for Pechiney, the French aluminium maker.

Pechiney reportedly wants to revive a e750m (£516m) deal to buy Corus's aluminium assets as part of a poison pill defence to see off a hostile bid from Alcan of the US. Talks on the sale of aluminium smelters in Holland and Germany foundered earlier this year after a veto from the Anglo-Dutch group's supervisory board.

But, according to The Wall Street Journal, Pechiney reckons the deal could now be revived. It reckons the mood may be changing at Corus, which takes in the old British Steel, following the appointment of Philippe Varin - a former Pechiney executive - as chief executive. Pechiney has exclusive negotiating rights over the assets until October. A deal would boost its market dominance in Europe, making any combination with Alcan more likely to be blocked on monopoly grounds.

Corus, whose shares have rallied strongly on speculation that refinancing talks are going well, put on another 1 1/4p to 20 1/4p.

A robust start to the week in the Far East and an early advance on Wall Street helped lift the London market to its highest close in more than three weeks. The FTSE 100 rose 69.5 points, or 1.7%, to 4127.6.

Better-than-expected second-quarter results from Citigroup and Bank of America boosted financials this side of the Atlantic. Lloyds TSB rose 13 1/4p to 476 1/4p while Abbey National was marked 19 1/4p higher to 511p. The results also gave a fillip to dealer screens provider Reuters, up 13 3/4p to 221p.

Traders also took heart from strong trading at Burberry, up 7 1/4p to 283p. The Burberry news, coming on top of last week's cut in interest rates, raised hopes that the consumer boom can be prolonged a bit, boosting Next Group 45 1/2p to 1108 1/2p, Woolworths 2 1/2p to 40p and Dixons 2 3/4p to 141p. Carphone Warehouse was 3 1/2p stronger at 90 3/4p after an upgrade from Evolution Beeson Gregory.

Software group Anite, which revealed losses of £113m last week, was in demand after three directors increased their holdings. Together they bought 140,000 shares at 32p and 32 1/2p. Anite rose 4 1/4p to 36 1/4p.

Gases group BOC was pumped up 35 1/2p to 872p after saying it might sell its indirectly owned South African business Afrox Healthcare.

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