Market report: Thursday close

By MICKEY CLARK FOR MAILONLINE
Updated:

 

SHARES in Rupert Murdoch's BSkyB dropped 53 1/2p to 746p after Deutsche Bank and US securities house Goldman Sachs moved to raise more than £1bn by placing warrants, or equity certificates, convertible into ordinary shares.

The 150m warrants will be convertible into ordinary shares on the basis of one-for-one at a heavily-discounted 710p in October 2002. Goldman has been charged with bookbuilding for the issue. The deal allows BSkyB's biggest independent shareholder, French media giant Vivendi Universal, to lock in the value of part of its 12% holding that was deposited with Deutsche Bank earlier this year as collateral for a £2.6bn loan.

Vivendi wants to raise money for a US buy and traders say this is the most tax-efficient way of doing it. The issue of warrants is also made up of about 8% of spare BSkyB shares. More than 104m BSkyB shares changed hands.

The rest of the market fell sharply, not helped by opening falls for the Dow in New York this afternoon. The FTSE 100 index fell 45.1 to 5074.9.

One big institution has chosen to crystallise its losses in the media sector following the sector's poor performance this year. As a result, Granada was one of the most heavily traded blue-chips. More than 68m shares changed hands as the price fell 10p to 136p. It followed a cross in 47.45m shares at 130p late on Wednesday. It appeared to be a bed-and-breakfast transaction designed to establish a tax loss. The Granada price has dropped from a peak of 223p in January.

Other B&Bs among media companies included 6.64m shares in EMI, down 20 3/4p at 340 1/4p, executed at 342p; 5.48m in publisher Pearson at 735p as the ruling price rose 2 1/2p to 795 1/2p, and 27.81m shares in advertising agency Aegis, up 2 1/4p at 92 1/4p. They went through at 78p.

Telecoms group Energis continued to lose ground with the price falling 3 1/2p to 63p. It follows a cross in 4.62m shares at 66p. Express Dairies rose 1p to 16p as a line of 6m shares went through at 15p as part of a delayed trade. Several lines totalling 8m also went through at that level.

The strong retail sales numbers boosted selected retailers, which accounted for five of the top 10 movers in the Footsie. Tesco rose 6 1/2p to 235 1/2p, Boots 13 1/2p to 580 1/2p, Morrison Supermarkets 4p to 197p, and J Sainsbury 6 1/2p to 354p.

Some brokers remain cautious about the sector. They say much of the spending in the run-up to Christmas has been lumped on credit cards which will need to be paid off in the New Year, diverting money from the High Street.

Computer software and information technology specialist Logica was the biggest faller among the top 100 companies, losing 125p to 705p after a downbeat trading statement. It warned that revenue growth in its wireless division will be lower than expected. Brokers had predicted growth of 40% but Logica has cut this to 30%.

Man Group gained 2p to 1117p, after broker CSFB raised its earnings forecast for 2002 by 11%, and by 10% for 2003. The broker has also increased it price target from 1300p to 1500p. A profits warning from Elementis sent its shares down 4 1/2p to 40p and hit ICI, down 29 1/2p at 367p.

• 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.

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