Market report: Shares mark time as Asia and interest-rate fears cap Footsie

STANDARD CHARTERED, the banking group, is back in the takeover limelight. A story that the 15 per cent stake held by Singapore businessman Tan Sri Khoo Teck Paut had changed hands started the excitement.

The buyer was said to be the Development Bank of Singapore, and although it was quick to reject the rumour, Standard shares, in busy trading, continued to move ahead, ending 35.5p higher at 680.5p.

Speculation about the Far Eastern tycoon's stake is never far below the surface. He is the last of the famous "white squires" who rode to Standard's rescue 12 years ago when it was under threat from a hostile bid from Lloyds TSB. Since that acrimonious encounter he has on several occasions increased his shareholding.

The bank was the subject of feverish speculation earlier this year when Barclays was seen as a likely bidder; there were suggestions its directors were split over an approach from Martin Taylor, Barclays's chief executive.

With its echoes of the days of empire through its middle and Far Eastern banking network, Standard is regarded as a desirable capture for a group like Barclays or even the repulsed Lloyds.

Futures activity, with the buyer of 250 contracts looking for a mid-July price of 760p, made a significant contribution to the day's activity; so did talk that Morgan Stanley had put a 1,000p target on the shares. Before the Asian turmoil took its toll, Standard shares were riding at 1,081.5p.

Imperial Chemical Industries was another active share, although its direction was downward. The shares fell 16p (after 34p) to 979p as its controversial telephone briefings on Wednesday continued to take its toll. Since the conversations the shares have fallen 55p as analysts have taken the axe to their profit forecasts. Stockbroker Sutherlands cut its year's estimate from pounds 530m to pounds 400m. CSFB moved from pounds 530m to pounds 500m.

There are suggestions that ICI's telephone conversations may have broken Stock Exchange rules. It is said that the Exchange is investigating, although one-to-one briefings are a regular occurrence in the City. The argument revolves around insider trading which would have occurred if any trading had taken place based on information which was not in the public domain. There was, however, widespread market awareness of Wednesday's downgrades.

Analyst input was evident yesterday with, for example, Rentokil, the environmental group, up 6.75p to 437p after meeting analysts. Merrill Lynch seemed to go against the pack, changing its stance from buy to neutral.

Credit Lyonnais urged a switch out of J Sainsbury, off 6.5p at 554.5p, into Asda, up 2.75p to 207.75p, or Tesco, down 4.5p at 578p; the latter is taking analysts to see its Irish operations next week.

Gallaher, the tobacco group, was puffed 4p higher at 317.5p on Dresdner Kleinwort Benson support; the company meets analysts on Monday.

Cable & Wireless Communications' recent headlong charge came to an end with the shares easing 12p to 594.5p. Henderson Crosthwaite moved its target price to 650p using the AT&T deal with Tele-Communications Inc, America's biggest cable company, as a yardstick.

Last month a Canadian group sold a 14.25 per cent stake at 460p.

Recruitment group Robert Walters added 18p to 423.5p after Killik said the fall from a 565p peak last month had been overdone.

Most equities moved narrowly, with Footsie recording a 18.5-point gain to 5,877.4. But mid cap shares were back to their losing ways, although the small cap index notched up a small advance. Asia remained an inhibiting factor. Reports that the last MPC meeting voted seven-to-two in favour of the base-rate rise to 7.5 per cent increased fears that higher rates are on the way.

The Government's power play left PowerGen, known to be keen on buying a regional electricity company and also rumoured to be talking to America's Houston Industries, up 20p at 850p.

National Power, which let it be known it did not plan to sell any more coal-fired power plants, rose 4p to 585p. RJB Mining, with DKB saying the shares have a 150p "fair value", fell 14p to 121p.

The housebuilder, Barratt Developments, gave up 13p to fall to 260p with, it would appear, an attempt to place 250,000 shares doing most the damage.

Psion, the handheld computer group, caught its breath after the week's staggering rise: even so it achieved a 5p gain to 607.5p.

Claremont Garments produced its much delayed figures. Underlining the market adage that delay means dismay, it announced a pounds 12m loss. But it could have been worse, some felt: the shares gained 4.5p to 34p.

Two companies were suspended, pending acquisitions. London & Edinburgh Publishing, halted at 9p, is buying TLA Publishing Services, which provides back-up services to publishers, for up to pounds 5.24m.

Trading was stopped in the investment group Parambe after it agreed the reverse takeover of Gioma, a restaurant chain taking in such brand names as Gaucho Grill and Down Mexico Way.The cost is pounds 6.3m.

SEAQ VOLUME: 772.8 million

SEAQ TRADES: 56,811

ARM, the microchip maker, had an eventful session. At one time up 225p, the shares ended the day with a 100p gain at 1,080p.

Deals with two groups for Arm's Risc chip was the reason for all the excitement. Arm is also regarded as a likely chip supplier for Psion's superphone.

The company only arrived on the stock market in April. The shares have been down as low as 750p. Acorn Computer, up 11p at 129p, is a major shareholder.

ODD GOINGS-ON at struggling marketing group Birkdale. Photobition, which supplies printing services, has made a pounds 1.8m bid for three Birkdale subsidiaries which are being sold to Kevin Morley, Birkdale's chairman, for pounds 1.6m.

Birkdale's directors have rejected the offer, prompting the printing services group to suggest a shareholders' meeting be called to resolve the issue. Photobition shares were unchanged at 293.5p and Birkdale held at 1.25p.