MARKET REPORT : Digital side appears to be winning the TV revolution

The television spectacular again dominated the stock market with the digital participants getting the star treatment and the supporting players the brush off.

Worries the picture for the provincial TV companies has suddenly turned dim and blurred sent their shares tumbling. Scottish TV fell 81.5p to 546p and Yorkshire-Tyne Tees 80p to 1,102.5p. HTV was off 30p at 327.5p and Ulster 14p to 161p.

Cable shares, also seen as obvious casualties of the digital alliance, continued their retreat. General Cable, Nynex and Telewest Communications all weakened.

The market believes the independent TV groups, which have romped ahead on expectations of a round of takeovers following the industry free-for- all, may well be marginalised and in any event have lost much of their bid appeal.

Carlton Communications led the digital charges with a 16.5p gain to 575p. Granada was not far behind, up 20p at 917p, and BSkyB, interim figures tomorrow, 10p to 609p. Flextech gained 16p to 715p.

The TV revolution sent ripples of unease through the rest of the media section. Mirror Group, with nearly 20 per cent of Scottish, lost 4.5p to 205p, and United News & Media, owning 29.9 per cent of HTV, fell 31.5p to 671p. Pearson gave up 22p to 737.5p.

Scottish and Yorkshire have been at the forefront of the bid speculation. Granada has made no secret of its liking for Yorkshire and its chairman, Gerry Robinson, has described an eventual bid as "inevitable". Granada has around 27 per cent of Yorkshire with United embracing 14.5 per cent.

Dixons, the retailer which should have enjoyed the TV excitement, was uncomfortably subdued, crashing 38p to 479p. A negative recommendation is due this week from Merrill Lynch. Chairman Sir Stanley Kalms' sale of 1 million shares and his angry reaction to Greig Middleton sell advice contributed to the damage.

Pilkington was another to crack, off 3.5p to 145p, just above its 12- month low. SBC Warburg cut its profit estimates by pounds 10m to pounds 175m and said sell down to 125p. A warning about European glass prices from St Gobain of France prompted the cut.

Tomkins, the buns to guns conglomerate, gained 5p to 285p ahead of an analysts' visit to its US operations and Ladbroke gained 3.5p to 232.5p following its Texas Homecare settlement and hopes of a US bid.

The market had a lacklustre session with New York weakness lowering Friday's heady temperature. Footsie ended 18 points off at 4,257.8 and the supporting FTSE 250 index lost 20.5p to 4,574.9.

Drug shares tended to give ground although investors are pinning their hopes on an analysts' meeting called by Roche. There are indications the Swiss giant is raising cash and some expect it to reveal plans to democratise its share structure - a move which could herald the long-awaited takeover strike.

Cortecs International put on 9p to 215.5p. Nomura forecasts a swing into profits in 1999 and says the shares are worth 420p.

Share build-ups produced the predictable response. Wassall, the conglomerate, has acquired 4.1 per cent of TLG, the lighting business split from what was then Thorn EMI; it was enough to send the shares 13.5p higher to 118.5p although Wassall, up 7.5p to 326p, played down any predatory intent.

Trace Computers gained 10p to 57.5p as MMT Computing disclosed a 3.27 per cent interest. Applied Distribution reported a takeover approach below 62p and its shares fell 12p to 50p.

The day's profit warning came from Circle Communications, a film group, which slumped 82.5p to 120p.

Biocompatibles International's merry romp continued, up 75p to 1,230p.

Football companies, in particular Chelsea Village, are tapping the market for cash. Chelsea raised pounds 1.5m through a placing at 140p and Caspian (Leeds Utd) pulled in pounds 5.7m with a share sale at 42p. Chelsea rose 8.5p to 162.5p and Caspian fell 1p to 43p.

Marshalls, the building materials group, was little changed at 130.5p as stockbroker Granville Davies forecast year's profits of pounds 18m (down from pounds 25.8m) but said the shares should be held.

Intercare, the health group, added 3.5p to 78p as John Siddall said buy, forecasting profits would advance from pounds 2.2m to pounds 2.8m this year.

Eurotherm, the industrial controls group, fell 25p to 472.5p, a 12-month low, as worries a profit warning is set to emerge continued to circulate. The group was the subject of an unseemly boardroom brawl last year.