A SERIES of options expiries across Europe and the US, plus suggestions of big selling of US Treasury bonds by hedge funds over the past two sessions took the gloss off an early surge by British equities.
At the close of a busy trading session, the FTSE 100 was left nursing an 8.9 decline at 3,770.9. An early burst of strength triggered by two FTSE Mid 250 bids drove London's stock market sharply higher in early trading.
The FTSE 100 index hit a record intra day high of 3,791.6, shortly after the opening, while a hostile bid for BET, the support services group, from Rentokil and an increased offer for Lloyds Chemists from Unichem, helped catapult the FTSE Mid 250 index through the 4,200 level. The second line index eventually closed tantalisingly below the 4,200 level at 4,199.9, up 10.8.
British stocks have performed exceptionally well over the week during which they have had to negotiate the Scott report as well as the Bank of England's quarterly inflation report and a variety of economic news. The resumption of the IRA's bombing campaign in Britain also caused plenty of unease.
Over the five day period the FTSE 100 index has risen 54.6, or 1.5 per cent, while the FTSE Mid 250 has put on 48 points, or around 1.2 per cent.
The latest burst of takeover news fuelled speculation of more bids to come. Dealers said there was keen support across various market sectors as investors tried to pinpoint to next bid candidates.
