Shopping for a bargain at Somerfield

The whiff of trouble in the new issues market always causes morbid pleasure among City folk who don't have a flotation of their own on the launch pad. However, in the case of Somerfield, it could be investors who are happiest. At the revised price of 145p, the shares will start off at a deep discount to the market. True, the former Gateway stores group does not have the most attractive retail sites and will always compare poorly with Tesco and Sainsbury. But the UK food retail market continues to generate above- average margins compared to Europe and the US, so a hostile bid cannot be ruled out. The shares are expected to debut at a modest premium, but investors who did not apply for shares before the offer closed could find a nice bargain when dealings start on 9 August.

The slide in BTR's share price was halted this week by an upbeat recommendation from NatWest, and a feeling in the market that at 240p, the share has been oversold. However, the fundamentals - eroding margins, a weak cash position and the likelihood of a dividend cut - have not changed. It remains a sell.

Banks are back in fashion, according to the strategists at Merrill Lynch. The sector took a tumble earlier this year over fears of a mortgage price war, and has only recently started to recover as those fears abate. A recent survey of fund managers found them optimistic about the banks' prospects. Best of all, the UK high street banks are in the habit of throwing off large amounts of cash to shareholders through share buybacks and special dividends, which makes them cosy places to be if the market turns stormy. Potential havens include HSBC (1059p), whose interim results are out on Monday 5 August; Barclays (803p), reporting on Tuesday 6 August; and Lloyds TSB (332p), whose interims last week were at the top end of analysts' expectations.

Misys, Britain's largest independent software company, is gearing up to impress the City when it reports full-year results next Thursday. Pre- tax profits are expected to be around pounds 49.5m, in line with analysts' forecasts and including a contribution from ACT, the banking software company it took over last year. The shares stand at 758p, down from a high of 852p. The current jitters about technology shares will not help, but its strong position in banking technology and healthy balance sheet will stand it in good stead. Buy.

Mulberries, the Ofex-listed business services group, is cooking, with details expected this week of a reverse listing by Sebastian Snow, the London chef. Mr Snow will inject his two restaurants, B Square, in Battersea, and Snows on the Green, in Shepherds Bush, and a catering business into the company. Combined turnover for the enlarged group is expected to hit pounds 3m, with profits of pounds 300,000. The shares stand at a penny.

It looks like nothing can stop the advance of BSkyB. The shares, 410p at the start of the year, shrugged off a mildly critical Office of Fair Trading report on Wednesday to finish the week at 498p. But the company will have to work very hard to meet the market's expectations. Its pounds 670m contract to broadcast Premiership football matches until 2001 will require lots of new high-margin satellite subscribers to justify the investment, and that does not look likely in a maturing market where new subscriptions are coming via the cable companies. Now is the time to disconnect.

Psion's abrupt termination of merger talks with Amstrad should not cause too much anxiety among its shareholders. In fact, they should pat chairman David Potter on the back for walking away from a deal that wasn't right for his company. Psion remains a personal organiser company in search of telecoms technology (it was really after Amstrad's Dancall mobile phone subsidiary) but it's clear Potter will wait for the right phone to come along. Investors should reward his patience by sticking with the shares, currently at 423p.