Market Report: Pakistani strike sends Lasmo shares gushing ahead

Lasmo, the oil group which distinguished itself by fighting off the hostile advances of Enterprise Oil, gushed 17.5p to 258.5p at one time as a leading securities house appeared intent on buying every share in sight.

Stories flowed that Lasmo was set to collect another takeover bid; there was also intense speculation about a strike in Pakistan.

The price ended at 256.5p with SEAQ putting volume at 5.2 million shares. ABN Amro Hoare Govett appeared to be the main buyer.

The suspicion Lasmo is a takeover target has been evident for months. Few expect Enterprise, after the bloody nose it received last time, to venture forth with a new offer; it is widely accepted the revitalised group will swoop in another direction.

But there is a strong feeling Lasmo could be in the sights of a transatlantic predator. US and Canadian oil groups have displayed a tendency to flex their corporate muscles and there is no doubt Lasmo would be a significant capture for a string of groups.

The possibility Lasmo, perhaps glancing anxiously over its corporate shoulder, could emerge as the attacker also occupies stock market minds. Although Enterprise, as it would, has played down this week's talk it is about to roll out a bid a number of its suggested targets have shown remarkable resilience.

British Borneo Petroleum Syndicate gained 26.5p to 1,451.5p and Cairn Energy, figures next week, rose 6.5p to 583p with some pondering a Lasmo strike.

The Pakistan hit was said to be a massive gas find. A vast gas reservoir was said to have been discovered at Lasmo's Bhit-2 well, not far from Karachi. Drilling has been completed and Lasmo is busy evaluating the findings. It hopes to be able to make a judgement in the near future.

Enterprise continued its heady run, gaining a further 7.5p to 659.5p, and Dana Petroleum, on its strengthening ties with the former Soviet Union, put on a further 1.5p to 25p.

The rest of the market spent the session under the shadow of New York. Thursday's 160.48-point slump by the Dow Jones Average sent Footsie down 46.7 points in early trading.

But the fall was whittled away and when New York opened with a burst of confidence Footsie took fresh heart, ending up 26.6 points at 4,424.3.

Fears of higher interest rates, possibly next week, were behind Thursday's US turmoil. It is generally accepted that transatlantic rates will be lifted although any increase could be some weeks away.

BG, once British Gas, was busily traded with some even sniffing takeover action. The price gained 2p to 172p. Centrica, British Gas's former distribution arm, also enjoyed an active session, ending little changed at 60.5p.

Stagecoach, the buses and trains group, was shunted 24p lower to 732.5p as its chaotic South West Trains operation suffered humiliating treatment from the railway's regulator.

Shield Diagnostic was another under pressure on disappointment that the much- vaunted Houston set of trails into its heart disease detection system may be unproductive because of spoilt samples. The company's treatment has already enjoyed successful tests in this country. Shield is pressing ahead with a City presentation later this month.

The shares in frantic late trading crashed from a 919p peak to 507.5p, before rallying to 667.5p, off 137.5p. But some drugs were on a high. Cantab Pharmaceuticals jumped 127.5p to 1,020p ahead of results due next week and Biocompatibles International bounced 62.5p to 1,237.5p.

Ransomes, the lawnmower group, gave up 18p to 32p following a profit warning.

Yorkshire-Tyne Tees Television steadied at 1,167.5p after Granada's sudden display of indifference; Granada shaded 2.5p to 954p.

United News & Media rose 30p to 770.5p on its results.

J Sainsbury gained 11.5p to 327.5p on suggestions of a sales recovery and Reckitt & Colman added 40.5p to 327.5p as Unilever bid hopes resurfaced.

General Electric Co flicked 11.5p higher to 394.5p on its expected pounds 2bn submarine order. BAT Industries drooped 14.5p to 540p on the latest twist in the US litigation serial.

Insurance brokers had one of their more fascinating sessions with the sector dominated once again by takeover talk. The latest US broking merger has reawakened thoughts that it cannot be long before Willis Corroon, up 3.5p to 160.5p, merges with its old rival Sedgwick, 2.5p higher at 129p.