Market report - Thursday close

By THIS IS MONEY
Updated:

 

Investors who held onto the Halifax windfall shares were celebrating today as the stock surged up 22% on the announcement of an internet insurance scheme.

Peter Wood, the insurance tycoon who made his fortune setting up Direct Line, is to join Britain's biggest mortgage lender to sell insurance cover over the internet. The arrival of Mr Wood, who revolutionised the flabby insurance market in the 1980s with his direct sales model, was greeted with a resounding hurrah by investors and shares in Halifax rose 99p to 552p.Halifax's decisive upward move was not matched by the FTSE-100 Index which was buffeted from all directions by economic data today.

Retail sales figures showing prices still under pressure on the high street and a relaxed inflation report from the Bank of England allowed the market to pull ahead.The decision by the European Central Bank to leave interest rates on hold and wholesale price data from the US showing inflation still subdued added to the upbeat mood and the Footsie stood up 114 points at lunchtime.

But comments from Alan Greenspan chairman of the US central bank later in the day suggested interest rate hikes were imminent.The comments sent the Dow Jones Industrial Average falling, taking the shine from the Footsie at the same time.

But the London blue chip benchmark held on in positive territory and closed up 61.9 points at 6209.3.

But the magic word - internet - worked its charms for a number of investors.Abbey National's shares have halved since last April, but plans outlined for an internet bank subsidiary took them up 47p to 713p. A strong set of results and a broker upgrade helped.Online personal finance company Internet Investor International floated its shares at 150p each but quickly saw them jump in value to 338 1/2 p.The rise made paper multi-millionaires out of three of the company's directors.

A number of Footsie groups also saw sharp share price moves on the back of news reports and announcements.Railtrack jumped as investors responded to plans to spend an extra £500 million on the network in the coming financial year.

The announcement eased fears of hawkish regulators stamping their authority on the group and shares gained 65p to 741 1/2 p.Sir Martin Sorrell's WPP group reported profits in line with expectations and was punished harshly for it. Shares slid 5% and more, falling 125p to £10.29.

Computer services group Sema gained in the first minutes of trading after unveiling a surge in underlying profits last year.But the figures were not enough to earn long term commitment from buyers and shares later fell back sharply on profit-taking - down 149p to £15.00.

Building materials group Hanson put on more sustained gains after reporting bumper profits. Hanson shares built up 21p to 425 1/2 p.The main risers in the FTSE-100 were Halifax up 99p to 552p, Associated British Foods up 36 3/4 p at 339p, Cadbury Schweppes up 35p at 377p and Legal and General up 13 1/4 p to 148 3/4 p.

The main fallers were WPP down 125p to £10.29, Sema down 149p to £15.00, Royal Bank of Scotland down 41p to 739p and 3i Group down 58p at £11.93.

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