Mid-250 achieves another record

TAKEOVER speculation, one of the main driving forces behind the London move to record levels, reached fever pitch yesterday.

"Even if we don't get a bid tomorrow, the market is bracing itself for a burst of takeover deals," said one senior trader.

The list of candidates grew much longer, with Lucas the market's latest favourite to attract the attentions of a predator. Turnover in Lucas expanded rapidly throughout the session.

Even without the preoccupation with bid stories, the stock market was buzzing with activity. Wednesday evening's 70 point setback in the Dow Jones Industrial Average was offset by the 50 basis points reduction in Germany's two key interest rates.

At the close, the FTSE 100 index was left with a 15.1 gain at 3820.7, almost wiping out Wednesday's setback. The market's premier index was easily out paced by the FTSE Mid 250, which spiralled upwards through out the day to achieve its fifth successive new record. It came within 6.4 of the 4500, eventually ending the session a net 29.5 higher at 4493.6.

Over the past seven trading days, the Mid 250 has risen 116.5, or 2.6 per cent. Over the same period the FTSE 100 has gained 62.1, or 1.6 percent.

This morning is expected to bring plenty of fireworks in the marketplace, with dealers looking for a sharp rise in share prices ahead of the expiry of the FTSE 100 index option. Some said 3850 on the Footsie was easily achievable. But they warned the index could well fall back after the expiry.