Market report: Wednesday close

By MICKEY CLARK FOR MAILONLINE
Updated:

 

SHARES in London staged a late rally as news of the surprise rate cut by the Federal Reserve crossed the Atlantic.

The FTSE-100 index was well inside positive territory, buoyed by a strong opening on Wall Street, but it closed 129.1 points ahead at 5890.2 as a last-minute surge added around 30 points.

Tech stocks were back in favour. Dimension Data led the way with a rise of 41p to 300p as Deutsche Bank repeated its 'buy' recommendation. Sage was up 52p at 278p, and Marconi rose 45p to 365p. Cable & Wireless repaired Tuesday's damage with a gain of 28 1/2p to 527p as US securities house Goldman Sachs raised its earnings forecast to take in the Optus disposal.

But elsewhere there was more gloom for troubled Railtrack . It slumped to yet another low and the shares now stand only 48p above the 390p at which they were floated in May 1996.

The price retreated a further 4p to 438p as the railway infrastructure group faced fresh compensation claims from train operators. It is six months since the Hatfield crash and under the terms of their operating agreements, train companies can now claim substantial compensation for long-term loss of business. Railtrack argues that the rule applies only to specific speed restrictions and future loss of business, but the operators, including Sir Richard Branson's Virgin Trains, reckon they have a good case.

In 1998, Railtrack hit a peak of 1,768p but fatal crashes, claims for compensation and pressure from the regulator to improve the service have taken a toll on the shares.

GlaxoSmithKline fell 62p to 1808p on reports that the 39 drugs companies suing the South African government over the intellectual property rights to anti-Aids drugs are prepared to drop the case.

Pearson shrugged off bearish comments from broker Credit Lyonnais Securities with a rise of 159p to 1444p. The broker is worried about the slowdown in advertising revenues and has downgraded its recommendation from 'add' to 'hold'.

BOC fell 6p to 972p. The industrial gases group is hosting a presentation to institutional investors and brokers this week in Boston to update them on its earnings growth forecasts. Capita Group climbed 22p to 438p after shareholders at the annual meeting received a bullish trading statement from chairman Rod Aldridge. He said revenues were expected to grow 43% this year.

Someone has paid a hefty premium for a large chunk of shares in insurance broker Chaucer, up 3 1/2p at 64 1/2p. A line of 10 million shares went through the market late on Tuesday at 66p. That compares with the market size of 2000 shares at which traders will normally quote a price, with only 84m shares in issue. Broker Numis Securities, the old Raphael Zorn, is reckoned to have done the deal and City speculators say there is no smoke without fire.

AIM-listed Brandon Hire hit a high for the year with a rise of 5p to 63p on the back of a bullish trading statement indicating that operating profits would double in the first six months. I also hear stock market tipster Jim Slater is continuing to snap up shares in the plant hire group.

• 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.

Geoff Foster of the Daily Mail on yesterday's trading

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