The London market ended a soggy week on a damp note as bids and revived prospects of corporate activity were overshadowed by Asia and oil.

Dealers believe that a big bid will be tabled very soon. The focus has been on the banking and insurance sectors, where a link with a life company has been mooted for some time. Yesterday, Halifax broke through into new territory as institutions chased the stock and low-grade chat suggested a merger with General Accident.

However, the focus has also shifted to pharmaceuticals where the prospect of a transatlantic marriage between SmithKline Beecham and American Home Products, which could create the world's biggest drugs company, has set analysts' pulses racing.

And more cash is expected to pour into the market following the auction between Hercules and Ciba over Allied Colloids. Elsewhere, BT has been buoyed by rumours of an offer from Mr Bill Gates's Microsoft, BAT bubbles with demerger talk and Zeneca has once again attracted some of the oldest bid stories in the market.

"The market has been buying all week with all the heavyweight bid stories," said one senior trader in international stocks. "But are they all going to happen? No. And when the bid premium goes then this market has a long way to fall."