Market Report: Shares full of life as a tradition prepares to die

TRADING accounts may be redundant but the end of a 200- year-old stock market tradition is not being allowed to fade quietly into oblivion.

On the penultimate day of the last trading account shares boomed, with the FT-SE 100 index scoring a 45.1-point gain to 3,050.4. Since the account got under way it has risen 114 points.

Today is expected to produce a series of wakes as stockbroking firms acknowledge the end of the old trading system with commemorative parties. The death of what has been a reliable share dealing set-up is not, as some suggest, being greeted with universal acclaim.

Many see the switch as yet another threat to the survival of the private investor who, without assistance, could find it difficult to accommodate the 10-day rolling settlement, which is expected to slip to five and then three days.

The market's strength was a follow-through to Wednesday's rail strike-bound performance. In two days the Footsie has risen 86.5 points.

Once again it was the encouragement provided by the latest round of Whitehall statistics that generated much of the enthusiasm. US figures, which could be read as lessening the need for an interest rate increase, helped the dollar and added to the more relaxed attitude of the London market.

The latest bout of exuberance was achieved on the back of some determined buying, with institutional investors again leading the charge. Government stocks were in demand, scoring gains of up to a point.

Tesco's surprise pounds 154m strike at the Scottish supermarket chain Wm Low got the market off on the right foot. The market needed takeover action and there has been a deep suspicion that a biggish deal was being lined up. But the Wm Low bid came as a surprise; indeed the shares had remained rock solid at 169p this month.

The arrival of Tesco sent them romping ahead and when J Sainsbury let it be known that it could, just possibly, be tempted into action, the Low shares reached 236p, up 67p.

Tesco rose 10.5p to 232.5 and Sainsbury 10.5p to 399.5p. Wm Morrison, which had been regarded as the most likely supermarket to collect a bid, gained 2p to 120p.

Cable and Wireless jumped 21p to 433p as a US group, BCETI, which has interests in this country, announced plans for a flotation. C&W has a 20 per cent interest, with Bell Canada accounting for 80 per cent.

Insurance shares were strong, with Sun Alliance up 14p to 313p on TransAtlantic bid hopes. Royal Insurance gained 10p to 250p, enjoying a Salomon Brothers recommendation.

Plans to redesign the dollar lifted the security printer Da La Rue 22p to 951p and Portals 27p to 678p.

Defence shares advanced on the Government shakeup. Vosper Thornycroft gained 22p to 729p on its capture of a contract for seven minehunters; Vickers rose 4p to 174p following a 259 Challenger tank order, worth pounds 800m.

British Steel continued to make progress, with UBS joining the profit upgradings with pounds 350m against pounds 250m. The shares rose 4p to 159p, a year's high.

Dawson International, the up-market textile group that was recently forced into a cash call following a disastrous US excursion, rose 2p to 156p. SG Warburg trimmed its profit forecast by pounds 3m to pounds 30m.

But Warburg, up 3p to 697p, had to contend with a James Capel downgrading from pounds 310m to pounds 260m.

BT moved up a further 4p to 391.5p as it at last got the go- ahead for its link with MCI, the US group.

Berisford International edged forward 2p to 208p on rumours that it was thinking of closing part, or all, of its Magnet retail side. MFI rose 3.5p to 155.5p.

Electricities were bright as the regulator decided against allowing large users to operate outside the industry's pool system. Waters took a more optimistic view of this month's Ofwat review, achieving gains throughout the list.

Wardle Storeys, the chemical group, held at 380p. But the signalled departure of Brian Lees, managing director of technical products, caused some unease. Wellcome gained 11p to 615p, despite the surprise departure of the research director, Dr Trevor Jones.

Mosaic Investments rose 3p to 30p on the plans to float its Copyright Promotions, a character licensing operation.

Johnson Fry, the financial group that lurched from disaster to disaster before a restructuring exercise, is thought to be on the verge of flexing its takeover muscles. Once famed for its business expansion schemes, it is believed to be near to buying a fund management group in exchange for shares. The deal is said to be earnings-enhancing. The shares held at 188p.

Peter Black, the footwear and healthcare group, put on 3p to 240p following the upbeat Marks & Spencer statement. The group is a big supplier to M&S and there are hopes that after a sharp interim advance year's profits will emerge near a pounds 12m peak against last time's pounds 9.1m. Earlier this year it sold its Factory Shop retail chain for pounds 4.25m to concentrate on its core operations.

The FT-SE 100 index gained 45.1 points to 3,050.4 and the FT-SE 250 index 36 points to 3,529.7. Turnover was 733.2 million shares with 26,488 bargains recorded. The last account ends today with settlement on 25 July.

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