*** Bid talk boosts the blue chips
*** Morgan Stanley chief calls it quits
*** Why America's missing out on online gambling...the demise...and more
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------------------- Bid talk pushed the blue chip index up to its highest level since mid-February yesterday.
Building materials group Hanson gained more than 3% on Monday on rumours that France's Lafarge may be eyeing it up. This follows the $8bn move for Germany's HeidelbergCement by Spohn Cement, with traders reckoning the London group could be the next target.
Meantime insurer Royal & Sun Alliance also found itself the subject of deliberations: investment unit Corvus, owned by financier Andrew Regan, admitted that RSA is a potential takeover target. According to RSA, it had received no approach as yet, but the share price firmed some 3% yesterday. Corvus shares shot up 19%.
Yet just how suitable is a Corvus-RSA combination? RSA, the second-biggest commercial insurer in the UK, valued over £2bn, would indeed be a huge catch for Corvus, which listed last year on London's junior market, Aim. Yet if, as Corvus has suggested in the past, it's looking for a strong cash generating business, RSA may not be the ideal candidate: the group has been struggling to get itself out of the US, where it has suffered huge losses.
Both Hanson and RSA closed as top blue chip gainers on Monday. The FTSE 100 gained 20 points, to close at 5,050, while the All Share index traded 0.4% in the black.
The mid-cap index meanwhile also gained 0.6%, to trade at 7,307, boosted by oil explorer Burren Energy. According to the market gossip, Burren is about to announce a new discovery. Absolute balderdash, Burren responded after the market had closed although investors had already pushed shares up over 7%.
And with Dated Brent trading 2% up at $52.58 a barrel by London's close following remarks from Saudi Arabian oil minister Ali al-Nuaimi that Opec needs to increase its production ceiling Venture Production and Dana Petroleum both added 5%.
Cairn Energy also gained 4% as it said the Indian government had given it the thumbs up to explore the Rajasthan block for a further 18 months.
Over in Euroland, Italy's UniCredito bank has snapped up Germany's HVB in a 15.4bn euro all-share deal the biggest since Santander bought Abbey National eight months ago. The combination will now create the ninth- biggest bank in Europe and the cross-border bank will be a clear market leader in eastern Europe. But is it really all that cut and dried? Of course not.
And in the US, Morgan Stanley chief executive Philip Purcell has finally succumbed to growing criticism regarding his management reshuffle: he resigned and will leave the group as soon as a successor is found. 'It has become clear that in light of the continuing personal attacks on me...that this is the best thing I can do for...our shareholders,' he said yesterday. And shareholders agreed: pushing shares up some 6% by London's close.
------------------- As a trader, it's not always easy to spot the difference between 'short-term hysterical melodramas and the longer term, bigger picture structural changes' that occur in the market place, says MoneyWeek's Tim Price. But there is one trend that seems to be changing and it's all down to the Yanks: it could be that by banning online betting in the US, they've forced it over to the London market. But the question is, does New York really want to bet against the online gambling industry?
It was but one year and two days ago that the Profit Hunter team said: 'In a year's time, talk about the demise of a currency will be focused on the Euro, not the US Dollar'. So, 'we were two days late', says Sven Lorenz in the Profit Hunter Files. Yet now the 'no' votes in France and the Netherlands have led to turbulence in the world's currency markets. And it really won't be that hard to take some of the Europe's euros 'out of circulation'... Mo
'When one of the world's best fixed-income investors suddenly switches from bearish to bullish, we have to take note,' says Sean Corrigan of Sage Capital. He is of course referring to Bill Gross, the head of Pimco's bond operations and one of the 'savviest and most forthright fixed income investors', who recently became remarkably bullish on fixed income... He may, however, wish that he hadn't...
