Rock soars after rescue guarantee

Jan 22 2008 by Peter McCusker, The Journal

THE FTSE 100 index suffered a major sell-off, down 323.5 points, or 5.48%, to close at 5578.2.

This followed overnight falls in the major Far Eastern markets. The US market was closed for Martin Luther King Day.

Northern Rock shares soared by 46.1% to close at 94.25p, as the Government unveiled plans to convert the Newcastle bank’s mortgages into loans.

These bonds would be guaranteed by the Government and the Treasury hopes this will be attractive to a private sector takeover.

The scheme has been assembled by Goldman Sachs, the US investment bank, and the Treasury guarantee indicates that taxpayers will be exposed to the potential losses.

Zytronic, where we act as broker, promoted Mark Cambridge to chief executive officer. Mr Cambridge has been a managing director of Zytronic Displays Ltd since February 2006.

The manufacturer of touch sensors and optical fibres has indicated that John Kennair will remain as chairman. Shares in Zytronic were 2.33% lower at 231p.

Elsewhere, Vertu Motors, where we also act as broker, said it had completed a lease agreement for a Motor Nation used car outlet in Doncaster.

This is the fourth outlet for Motor Nation and its first in Yorkshire. It extends to 1.3 acres and is expected to open by March. Shares in Vertu were unchanged at 34p.

The region’s largest riser was Northern Rock and most notable faller was D1 Oils, down 12.15%.

Ken Oiwa Ken.oiwa@brewin.co.uk