Surge in UK banking sector
THE UK stock market was in positive territory yesterday, supported by a surge in banking sector stocks.
Speculation mounted that Barclays and Lloyds TSB would announce higher dividend payouts when they report their results later this week, feeding hopes that the sector may be emerging from the worst of the sub-prime crisis.
The regional portfolio was overshadowed by the weekend announcement that the Treasury has decided to bring forward legislation to enable Northern Rock to be taken into temporary public ownership.
The shares have been suspended on the London Stock Exchange at 90p.
Elsewhere, the transport company Go-Ahead, which reported results last Friday, benefited from a positive upgrade as Dresdner Kleinwort, joint broker to the company, raised their view from a hold to a buy with a target price of 2400p.
Dresdner said that despite worsening losses at the Midlands bus division and higher fuel costs, the rest of the bus and UK rail divisions were performing well.
Separately, it was reported to the Stock Exchange that the chairman of Go-Ahead Group – where we act as joint broker – increased his stake in the company on Friday by 2,649 shares at 1865p per share. The share price ended the day up at 1922.5p.
Otherwise, Scottish & Newcastle shares lifted to close the day at 788.5p. The Newcastle Brown Ale brewer will report what is likely to be its last set of results as an independent company today after agreeing a takeover valued at £7.8bn by rival companies Carlsberg and Heineken.
Christine Hawdon Christine.hawdon@wise-speke.co.uk
