COMMITTEE MEETINGS:

Monday, 23 August 2004: 1215, Health and Medical Services Committee, Gilbert House

                                                    Historic Buildings Committee, 1330, Archives Building

Friday, 27 August 2004:              Standing Finance Committee, 0800, Liberation Room

                                                    Education Committee, 1000, Education Office

Note:  see FIH notice near bottom of story.     

Market Report: Traders check into Hilton ahead of results

      Michael Jivkov

      18 August 2004

Hilton was the flavour of the day among City traders yesterday as they  piled into the stock, convinced that next week's interim results from the gaming and hotels giant are set to impress. They believe that the group's Ladbrokes betting shops are trading strongly, partly thanks to the roll-out of its latest betting machines, while its estate of London hotels is said to be powering ahead with its strong recovery. Some suggested that  upgrades to analyst forecasts are likely in the wake of Hilton's numbers. The group gained 7.75p to 257.75p.  At the end of June, Hilton had installed 5,900 fixed odds betting terminals, which are basically electronic roulette machines, which is certainly a very aggressive roll-out. They are widely predicted to be a great money spinner for the company and should greatly enhance cash-flow at  Ladbrokes. As for the group's hotels, one market research agency recently  estimated that they may have experienced a near double-digit room rate  increase since this March.

Elsewhere, some of the Square Mile's favourite bid stories were back in vogue. Cynics argued that they were merely the product of idle brokers looking to generate some business for themselves. Nevertheless, they got share prices moving. Lloyds TSB put on 1.75p to 404.25p on talk that Deutsche Bank may be casting an eye over the UK banking giant. Great Portland ticked 9.5p better to 275p amid whispers that Liberty International, its rival and also its biggest shareholder, may finally table an offer for the company.

Rentokil Initial added 3p to 157p on speculation of a 185p-a-share bid from Sir Clive Thompson, the group's former chief executive, and backed by a private equity player, possibly Cinven. Analysts at Dresdner Kleinwort Wasserstein poured cold water on the story and advised investors to sell Rentokil. The German broker is sceptical that Sir Clive would want to pay 185p a share for the company given that he recently sold the bulk of his holding at below that level. Although there has been much talk of the potential return that a financial buyer could generate by a break-up of  Rentokil and a focus on its core business, Dresdner cleverly notes that  the real problem at the company is its core business - namely pest control  and hygiene products operations - which are suffering from falling profit margins.

Deutsche Bank got investors interested in LogicaCMG with an ultra-bullish  note on the IT services group ahead of its first-half results at the start of next month. Logica shares finished 5.5p higher at 165.5p. Deutsche argued that the group's present valuation is simply too low and that the market is over-exaggerating concerns about trading at the company. The broker also hinted that a possible acquisition may be on the cards at the group. It believes that Logica is looking at the purchase of Edinfor, a division of the Portuguese utility EDP and one of that country's largest IT companies.

Meanwhile, Morgan Stanley did Corus, down 0.5p to 43.25p, no favours at it downgraded the steel maker to "equal weight" from "overweight". Following  a 42 per cent jump in the value of Corus this year, the US broker believes some of its peers offer better value.   Lower down the pecking order, investors were surprised to learn that Country-wide's managing director, Harry Hill, had sold 38,0000 shares in the company at 286p following its profit warning last week.

 Traditionally, directors are seen buying shares in the companies they run after a setback. Shares in the estate agent put on 1p to 269.5p.Blacks Leisure added 5.5p to 408p as Numis Securities brushed aside  rumours of poor trading at the retailer. The broker reiterated its "add" rating on the stock after a conversation with the management team at Blacks and tipped the company to outperform fellow retailers this summer.

 Stanley Gibbon, the stamp dealer, rose 3p to 83p on whispers that strong trading has continued at the group and that its second-half results are  likely to beat expectations. Similarly, gossips talked of booming trade at Dart Group, 6.5p better at 162.5p. There soothing words from Altium Capital for shareholders in the caravan park operator Parkdean Holidays, 10p higher at 197.5p. Analysts at the broker returned from a meeting with  the company to report that the recent mixed summer weather had not affect its performance and that the group was performing in line with City forecasts.

British Energy, 0.5p higher at 20p, disclosed that the US investor Brian Stark had upped his stake in the electricity generator to 7 per cent. Hansard Group, 4.5p higher at 86p, announced that David Newton, the Monaco-based former stock broker, had cut his stake to below 3 per cent. Mr Newton has certainly done well out of Hansard. He built up a 17 per  cent stake in the PR company at prices well below 25p and seems to have sold the bulk of it at prices well above 85p.

Market movers:

Eurotunnel 16.25p (up 2.5p, 18.2 per cent). Dealers report short covering by hedge funds which have profited greatly from the stock's recent slide Bradford & Bingley 283.75p (up 5.25p, 1.9 per cent). Unveils various asset  disposals.

Tomkins 251p (up 4.25p, 1.7 per cent). Credit Suisse First Boston reiterates its "outperform" recommendation ahead of next week's second  quarter results from the group. Vodafone 123.75p (up 1.75p, 1.4 per cent). Benefits from a plethora of  positive broker comment after a series of meetings between the company's  chief executive and City analysts. Turbo Genset 16.75p (up 0.25p, 1.5 per cent). Secures US supply deal worth $750,000 (£410,130) and posts in-line interim results. St Ives 345p (up 14p, 4.3 per cent). Investors return to the stock after its recent heavy falls.  Big Food Group 82.75p (up 2.25p, 2.8 per cent). Bid rumours drive shares in the convenience store group high Meridian Petroleum 46.5p (up 5p, 12.1 per cent). Announces the purchase of two prospects in Michigan, US.Stanelco 5p (up 0.5p, 11.1 per cent). Signs deal for its RF sealing technology in the US and Canada Glow Communications 0.47p (down 0.04p, 7.8 per cent). Says it plans to de-list from AIM.

Falkland Islands Holding 417.5p (down 35p, 7.7 per cent). Traders take profits from a stock which has more than doubled since May Ultraframe 68p (down 7p, 9.3 per cent). Investors continue to exit the  stock after Monday's profit warning.

Hiscox 169.5p (down 3.5p, 2.0 per cent). Investors fret about a negative impact on Lloyds insurers from Hurricane Charley in the US.Casting 170.5p (down 9.5p, 5.2 per cent). Warns that the company is experiencing the worst hike in its cost base for 40 years because of the soaring price of oil. XP Power 400.5p (down 30.5p, 6.9 per cent). John Dyson, a non-executive director, sells 10,000 shares at 400p.  18 August 2004 23:31