Hopes of merger mania in the European defence sector helped lift leading shares today as the FTSE-100 Index made a positive start to the week.
Weekend reports of an impending merger between British Aerospace and Germany’s Daimler Chrysler Aerospace lifted BAe’s shares 24p to 520p.
GEC’s admission last week that it may also be seeking a merger partner left its shares leaping 12p to 546p, which in turn helped GKN up 3.5p to 677p.
The GKN gain came despite its unveiling of plans to spend £335m on US aerospace materials group Interlake.
The FTSE-100 Index lifted 32 points to 5613 in the opening minutes as dealers hoped for a less turbulent five days of trading than last week.
The positive start came despite expectations of weak manufacturing output figures due later in the morning. Analysts hope the data will spur the Bank of England to cut interest rates on Thursday.
ScottishPower finally announced it was merging with America’s PacifiCorp in a deal to create a £12bn utilities giant.
But the worst kept secret in the City did not impress and analysts were miffed at the company’s refusal to reveal expected cost savings. ScottishPower lost 29p to 646p.
British Land, one of the UK’s biggest property companies, gained 19p to 505p as it announced strong results and reassured investors that its exposure to City rents was not set to cause problems.
PA News 7/12/98
