26 JULY 1968, Page 28

Market report


The London market has slipped back. In- vestors, having taken the Financial Times index to 492.5—yet another new record—on Friday of last week, were uncertain where to go next; and found guidance from Wall Street. On Monday the Dow Jones index dropped by 13.60 points, the steepest fall for over a year. With London following suit, the Financial Times in- dex dropped by 9 points in the first half of the week.

The Imperial Tobacco Company, which sold its holdings in Gallaher at 20s a share two months ago, finds itself accused of losing £13 million now that American Tobacco's bid has put Gallaher over 30s. But until Imperial sold, no one would have bid for Gallaher: the whole purpose of the shareholding was to block an American bid. Its own shareholders can be pleased with the half-yearly figures, which show pre-tax profit up from £23.9 million to £26.5 million. In a generally falling market, Imperial put on over 4s to stand at 116s 6d, a shilling below their highest ever. In the second half of the year, Imperial will have the benefit of the penny-a-packet price increase.

Bank shares rose on hopes that the Mono- polies Commission's report would hasten the day when the real profit-and-loss figures are re- vealed. Unofficial calculations suggest, on tho basis of this—admittedly exceptional—year's profits, bank earnings can be bought three times as cheaply as the market average Williams Deacon's Bank is paying an un- changed interim dividend of 10 per cent on the kat half-year's results.