The Market Report: Halfords 'set to cash in' on Olympics year of the bike

Get ready for a cycling boom, was the sporty message from the Square Mile yesterday. With the Olympics just around the corner, City scribblers were claiming there will be a rush to follow in Sir Chris Hoy's tyre tracks as more and more of us jump on our saddles.

Rather than stockpiling lycra, Barclays Capital was recommending Halfords as the way to invest in the expected leap in two-wheeled activity. Saying 2012 will be the "year of the bike", the broker's analysts estimated that, thanks largely to the Games, the cycles market in the UK will grow by 5 per cent with the retailer enjoying an even greater boost.

They gave Halfords a push by saying they now expected its bike sales for the next financial year to grow 7 per cent while they also upgraded their rating by two notches to "overweight".

It has certainly been a bumpy ride for the group recently, having issued a number of profit warnings in 2011, but Barclays confidently proclaimed that the "cycle of earnings downgrades has finished".

In response, Halfords ended up in the leading pack on the mid-tier index after pedalling 10.5p higher to 318.5p. Nonetheless, it still has a way to go to regain the heights of 2010, with its shares having dropped more than 40 per cent since then.

Despite a positive start, the FTSE 100 quickly dipped into the red after the release of disappointing GDP figures and it closed 28.9 points worse off at 5,723. Developments in Greece, or rather the lack of them, were still a major focus, however, with no signs of a deal between the country and its creditors is imminent.

The banks suffered a sell-off as state-owned Lloyds and Royal Bank of Scotland dipped 0.76p to 30.93p and 0.3p to 26.75p. However, HSBC edged down only 3.1p to 537p despite the news that is being investigated by the US Senate as part of a money-laundering inquiry.

It was not all bad news for the financial stocks. Ashmore finished in the pole position on the blue-chip index by jumping up 15p to 370p after Barclays Capital said its focus on emerging markets made it more attractive than its rivals.

Some of the miners were on the rebound thanks to hopes a splurge by President Obama on infrastructure in the States will support metal prices, as Eurasian Natural Resources was driven up 20.5p to 731.5p.

However, BHP Billiton stayed steady at 2,129p and Anglo American fell 2p to 2,654.5p amid the revival of vague speculation they could be among the companies interested in a possible move for US coal producer Walter Energy, although traders were still unimpressed by the talk.

Fantastic figures overnight from Apple left Arm Holdings high up the Footsie's leaderboard. The chip designer, whose technology is used in the iPhone and iPad, advanced 17.5p to 597.5p after the US tech giant easily beat Wall Street's forecasts. Imagination Technologies, 14.5p better off at 566.5p, also got a lift.

It is not just Tesco's top brass who have increased their stakes following the recent profits warning as it was revealed that Paola Hanna, wife of non-executive director Ken Hanna, has bought over £78,000 worth of shares, Yet despite her following the example of a number of directors as well as US billionaire investor Warren Buffett, it slipped 7.15p to 322.85p amid concerns over how it will fare during Easter.

Weir continued its eventful run, climbing 15p to 370p after agreeing to buy US valve maker Novatech for $176m (£113m). The engineer shed over 14 per cent in less than a fortnight thanks to concerns over the state of the shale gas industry, but two consecutive sessions on the rise have helped it regain some of these losses.

Bid chatter was back on the menu for Aegis following the advertising agency's announcement on Tuesday that it has won a major $3bn contract for General Motors. Investec's Steve Liechti said the success may increase the likelihood of it receiving an approach, saying "this could now make Aegis more of a bid target, as it is eating the mega agencies' lunch".

There was certainly plenty of support for the group following the deal, with Panmure Gordon calling it "highly significant" while Numis Securities said they "agree with management that this account win marks a 'defining moment'". In response, Aegis sparked up 1.8p to 154.9p, its highest level since last July.

Bullish comments claiming its major electronics market is about to see a recovery helped Renishaw shoot up a huge 11.08 per cent to 1,283p, despite the precision engineer admitting its first-half profits had fallen 11 per cent.

Down among the small-cap stocks, Premier Foods spurted up as high as 11p before finishing the session 0.57p stronger at 9.51p. The struggling Hovis-maker's move was being pinned on short-covering amid vague speculation a refinancing deal could be imminent.