London's equity market, already lifted by confirmation of the Zeneca/Astra merger, which brought an end to one of the stock market's longest running take-over rumours, was buzzing late yesterday as a flurry of bid stories flashed around dealing rooms.
The latest rumours encompassed the oil and aerospace sectors and featured two of the biggest names on the London market, Shell and British Aerospace.
The former was said to be involved in merger discussions with any number of the US oil majors, including Chevron, Texaco and Conoco, while there were strong hints that the much-mooted alliance between British Aerospace and Dasa, the Daimler/Chrysler defence business, would be confirmed in the near future.
Oil specialists were generally sceptical of the Shell stories, which they said were being prompted by the recent spate of oil deals, including the link-ups between BP and Amoco and Exxon and Mobil. However, there were few in the market prepared to dismiss the Aerospace story.
Moreover, the beleaguered retail sector saw one of its former leading lights, Sears, race higher in response to renewed suggestions that a 300p a share bid has been tabled for the company.
The equity market was also being sustained by continuing expectations of another cut in domestic interest rates today, following the latest meeting of the Bank of England's monetary policy committee.
A reduction in rates, which would be the third in two months, was being taken as read, with only the size of the cut at issue. Dealers said the bulls were looking for 75 basis points or more and that there could well be some disappointment with a minimum cut of 25 basis points.
Turnover at 6 p.m. reached 918.2 million shares.
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