HARES ended 2003 on a high as the benchmark index notched up a ninth day of consecutive gains and posted yet another 17-month high.
City traders and fund managers* expressed satisfaction with the overall performance of the London market, even though it fell short of stronger showings in other global financial centres.
London’s year-on-year gain has been stretched to 13.5% in recent days, but remains around half the 25% gain sported by the Dow on Wall Street.
Fund managers such as Bob Parker at Credit Suisse Asset Management reckon Wall Street seems expensive, and he is looking to London for further gains in 2004 with better performances from blue-chips, in particular the oil and drug sectors.
Others continue to voice their concern about the impact of a falling dollar and huge US trade deficit.
The shortened trading session in London saw some of the lowest turnover of the year as prices traded in a narrow range. The FTSE 100 index shrugged off last night’s setback for Wall Street to post a rise of 6.5 to 4476.9, up more than 500 points in 2003.
It is beginning to look as if supermarket shares have enjoyed a bumper run-up to Christmas. They were being chased higher by fund managers ahead of New Year trading updates. Tesco rose 3 3/4p to 257 3/4p, with J Sainsbury 3 1/2p better at 312 3/4p, while Wm Morrison , which is bidding for rival Safeway, 2p firmer at 284p, put on 1 1/2p at 226p.
Bank shares were to the fore among those investors happy to open positions ahead of the New Year. Many of them continue to be attracted by the strong yields. HBOS was among the pacesetters with a rise of 3p to 723 1/2p, while Lloyds TSB added 3 1/2p at 448p and Alliance & Leicester rose 4 1/2p to 888p.
Luxury cruise ship operator Carnival briefly led the top 100 higher with a leap of 98p to 2360p following a trade in just 100 shares at that level. It closed 11p down at 2251p.
Smiths was hoisted 14p higher to 674p on a single trade in 449 shares at that level before settling 1p higher at 661p. EMI slid 1 1/4p to 158 3/4p on news that Belgian consumer association Test Achats is launching legal action against the UK music publisher and rivals Sony, BMG Music and Universal Music for installing devices on audio CDs preventing consumers from making copies.
Aggreko dropped 5 1/2p to 154 1/2p after broker Merrill Lynch downgraded its earnings forecast for the fall-back power supplier for this year and next. It has lowered its 2003 figure by 1% and 2004 by 7%, reflecting slightly worse-than-expected trading conditions in its international and European operations.
Merrill conceded this would be offset to an extent by strongerthanexpected growth in North America. But the international business has seen subdued trading in the second half of 2003 due to lost power contracts in Sri Lanka.
New Year’s Eve seems a strange day to bring a company to market, but shareholders in titanium mining specialist Aricom are unlikely to complain following a placing* at 15p. Demerged from Peter Hambro Mining, up 1p at 410p, Aricom saw its value almost treble, opening at 29 1/2p before touching 39 1/2p, at which it is valued at almost £35m.
Water group Pennon, up 2p at 680p, was chased higher by income funds for its near-6% yield.
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