Market report: Tuesday close

By MICKEY CLARK FOR MAILONLINE
Updated:

 

TOBACCO companies burned bright today following a court ruling in the US that effectively protects them from civil lawsuits brought by cancer sufferers.

The Supreme Court of California ruled overnight that no evidence from either the industry or from smokers may be introduced that emanates from the 10-year period from 1988 to 1998 when a law protecting the industry was in place.

But smokers may still sue for illnesses diagnosed before 1988, prior to the law being introduced. The ruling was delivered as part of a lawsuit being brought against American tobacco giants Philip Morris and rival RJR.

However, it will also affect the likes of BAT, up 17 1/2p at 730p, which has been fighting claims in the US courts brought by cancer sufferers against its US subsidiary Brown & Williamson. Gallaher rose 12p to 643p and Imperial Tobacco added 27p to 1033p.

Share prices recovered from opening falls, supported by an opening 300-point surge for the Dow in New York this afternoon. Sentiment was bolstered by claims that one big hedge fund had made a £5bn switch out of bonds and back into equities. The FTSE 100, down almost 100 points first thing, closed 134.6 points higher at 4131.0.

Cable & Wireless edged up 1/2p 158 1/4p despite credit rating agency Moody's downgrading its rating from A2 to A3.

On the High Street, Tesco rose 4 3/4p to 211 3/4p. It has begun its preclose season briefing with brokers and says profits should be 'broadly in line' with market forecasts. Brokers suspect the group may have begun to see a slowing down in like-for-like sales growth.

Boots touched 536p before rallying to trade 10p better at 555 1/2p. Broker UBS Warburg has downgraded its recommendation from hold to reduce and slashed its target price from 550p to 500p. It reckons shares of the High Street chemist look expensive and trade at a premium to its rivals.

Pick 'n' Mix retailer Woolworths rallied off its low with a rise of 2p to 25p. City speculators say the dramatic fall in the price since it broke off merger talks with Philip Green's Bhs may move him to take a second look at the ailing business.

Anglo-Dutch steelmaker Corus hardened 6 3/4p to 52 1/4p as US securities house Goldman Sachs raised its recommendation on the shares from market perform to recommended list with a target price of 100p. A line of 2.34 million shares went through at 45 3/4p.

Rival Precoat International marked time at 74 1/2p after buying back 6.21 million of its own shares at 95p.

US securities house Morgan Stanley has reduced its price target on HSBC, 21 1/2p better at 723 1/2p, from 900p to 800p. It has also lowered its target on Lloyds TSB, 19 1/2p dearer at 591 1/2p, from 700p to 600p.

The new Premier League season kicks off in less than two weeks but shares of last year's also-rans Manchester United struck a new low, dipping through the 100p level for the first time with a fall to 97p before closing 3 1/2p down at 100 3/4p.

Irish racehorse owners and financiers JP McManus and John Magnier still hold almost 9% of the shares through Cubic Expression and must now be nursing a trading loss. Dealers say high transfer fees and big salaries are to blame. Last month United paid £33m for Leeds defender Rio Ferdinand.

• Prices and indices in this section are supplied from various sources and calculated at different times and may not always match those listed on the site.

The Daily Mail's Geoff Foster on yesterday's trade
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