ANOTHER round of bid speculation in the wake of the BT/Cable & Wireless merger discussions, plus a relatively steady showing by gilts and talk that a big three day sell programme had finally been completed, helped propel the equity market sharply higher yesterday.
Although repeated attempts by the FTSE 100 to drive back through the 3,700 level eventually failed the index still posted a 27.7 gain at 3,699.7. Over a week in which equities and gilts were buffeted by the mad cow disease controversy, the index has fought back strongly, ending the five day period with a 7.3 decline.
Second line stocks maintained their recent outstanding performance, with the FTSE Mid 250 index posting its third consecutive record and closing a net 17.3 higher at 4,326.7 over the week this measure has risen 22.4.
Wall Street gave no help to London, with the Dow Jones Industrial Average little changed overnight.
A quietly firm performance by gilts did encourage the equity market, with the 10 year gilt settling around six ticks ahead at the close, only slightly off the day's best and the 20 year gilt 10 ticks higher.
The day's big in equities was undoubtedly the BT/Cable & Wireless merger story which prompted massive trading in both stocks and started another bout of intense takeover speculation.
