Oct. 23--Happy days! The mood in the City is bullish to say the least. Dealers are super confident that the fabulous Footsie will crash through its December 1999 all-time high level of 6.933.87 level, possibly before Christmas.
It rose a further 41.46 points to a five-month high of 6,695.66 yesterday after weaker-than-expected US September job numbers.
It seems counter-intuitive, but the weak payroll figures effectively ruled out the possibility the Fed might begin tapering its bond purchases before Janet Yellen takes over from Ben Bernanke as Fed chair in January. Wall Street advanced 38.30 points in the early stages to 15,430.50.
The powers that be are also adamant that a mega bid is brewing in the financial sector and it could hit dealers' screens within the next few weeks. If so, the heavyweight sector could propel the Footsie above 7,000.
Perennial takeover favourite RSA Insurance attracted an above-average turnover of 21m-plus and closed 1.8p better at 123.9p amid tasty talk of a European cash offer in the region of pounds sterling 6.6bn or 180p a share.
Broker JP Morgan sparked early buying interest by lifting its target price to 141p from 132p, advising clients that it believes RSA's UK underwriting results have 'turned the corner'.
But it was revived bid gossip that pumped up the volume. Over the years Italy's Generali, Zurich Financial and Allianz have all been mentioned in the same breath, but it was UK rival Aviva (2.4p cheaper at 438.4p) that was yesterday tipped to make a move.
Aviva in late October 2010 rubbished a pounds sterling 5bn offer from RSA for its property and casualty operations in Canada, the UK and Ireland. No discussions ever took place and RSA's move at the time was considered to be a sign of weakness which left it vulnerable to a bid itself. Since then there has always been the chance that Aviva could turn the tables on RSA and launch a knock-out cash offer.
Miner BHP Billiton jumped 77p to 1950.5p on a strong first-quarter production report. Production in iron ore and petroleum have been strong. Management has continued to drive down cash costs and rationalise capital expenditure, while hefty disposals have further strengthened the balance sheet.
Buying in belated response to an Investec recommendation and target price of pounds sterling 19 helped international bank Standard Chartered gain 26.5p to 1522p. In a note entitled 'I don't care... I love it,' analyst Ian Gordon says Standard is priced for an implosion that he cannot see. On 2014 forecast earnings, it is still the cheapest UK bank. Fill your boots! UBM slumped 56.5p to 697.5p after the media and marketing services group warned it expects full-year underlying revenue growth to be at or below 3pc with fewer new launch events in the fourth quarter and weaker market conditions in Brazil and India.
Better-than-expected full-year results helped property group Development Securities jump 22.75p to 225p. Peel Hunt lifted its target price to 230p and said once the Edgware Road development is realised within next 12-18 months cash resources will total one-third of the pounds sterling 274m market capitalisation.
Cinema chain Cineworld rose 10p to 399p as dealers were not surprised to hear that trading in the third-quarter slowed due to hot weather and weaker film releases. Nevertheless, box office takings still rose 1.4pc and is 7pc up on the year to date. Numis has a target price of 450p.
Shares of Spirit Pub Company, at 74p, were as flat as a pint of homemade scrumpy following in-line fill-year results. Pre-tax profits improved 6pc to pounds sterling 54.3m. Recent trading has been strong with managed pub like-for-like sales up 4pc.
The London Stock Exchange firmed 6p to 1653p following the appointment of Suneel Bakhshi as chief executive of LCH Clearnet.
Worries about Fowler Welch, its distribution and logistics business, dragged Dart Group 27p lower to 223p. Otherwise, the first-half saw strong growth from its Jet2 airlines and packaged holiday business. Some 635,000 passengers used Jet2 holidays in the first six months of the year.
AIM-listed Daily Internet fell 1.75p to 2.25p following a pounds sterling 3m placing at 1.5p a pop to help finance the pounds sterling 2.5m acquisition of Netplan. The transformational deal transforms DI into a mainstream managed hosting service provider.
In-deed Online eased 0.5p to 8.5p following its reverse takeover of Epic, the UK leader in e-learning with businesses in the US and Brazil. The enlarged company will be called Learning Technologies which will be the only listed e-learning business on the market. Andrew Brode, chairman of quoted RWS, will be a major 40pc shareholder.
Magnolia Petroleum edged up 0.2p to 2.7p after securing a new pounds sterling 3.1m three year credit facility.
Stock Spirits Group, the biggest vodka producer in Poland and the Czech Republic, gave its sponsors JP Morgan, Nomura and Jefferies a hangover on its market debut. Offered for sale at 235p, the middle of its original 210p to 260p range, the shares touched 240p and then collapsed under a weight of selling to close at 226p, a discount of 9p. Well over 44m shares were traded. Chief executive Chris Heath trousered nearly pounds sterling 2m from the sale of some of his 2.8pc in the float.