Market Report - London

The takeover-bid driven upsurge in London's equity market, was halted yesterday by the emergence of a real market-shaker.

Mr Martin Taylor, chief executive of Barclays Bank, announced his resignation and the bank said its full-year results would come in well below current forecasts.

That news came out of the blue in a London market basking in the glow of a sequence of big bids across the UK, Europe and the US, a glow which has prompted some serious inflows of cash into most global markets.

But London's equity market, still being boosted by the sudden burst of consolidation news announced earlier in the week, steadied itself after a poor opening, and finished on a reasonably positive note.

Wall Street was behind the late rally in London, with the Dow Jones Industrial Average, stimulated by the recent corporate activity, especially confirmation of the Exxon/Mobil merger, driving into new territory.

The FTSE 100 index ended a day of big shifts in either direction a net 16.3 ahead at 5,844.2, the index hit a session low of 5,768.7.

Over the week the FTSE 100 has risen 126.7, or 2.2 per cent.

There was no such rally in the market's second and third liners, however, which suffered from dose of bad profits news and profit warnings, continuing the recent spate of negative eroding stories in the market.

Yesterday, saw another potential bid in the construction sector with Natural Building Materials announcing it had acquired 10 per cent in Blockleys, the brickmaker, and was considering a full bid.

Bank shares, led by Barclays, occupied most of the downside positions in the FTSE 100, while Standard Chartered took second spot in the table after its chief executive unnerved investors by saying there would be further problems in Asian markets, and that they would impact on the bank's revenue.

But turnover held up well in the face of the bad news from the banks arena; at 6 p.m. turnover was 843.9 million shares with activity concentrated in the FTSE 250 index.