City Watch

The Farnborough Air Show, as ever the source of stage-managed news from aerospace companies, helped the shares of several of them join fully in the stock market’s rally. The pound’s slide against the mark also helped steady a wider range of engineering shares, which have been deeply depressed by the over-priced pound. One of the […]

The Farnborough Air Show, as ever the source of stage-managed news from aerospace companies, helped the shares of several of them join fully in the stock market’s rally.

The pound’s slide against the mark also helped steady a wider range of engineering shares, which have been deeply depressed by the over-priced pound.

One of the strongest recoveries on Monday came from TI Group, which jumped by 6.4% in a single trading session.

Rolls-Royce recovered well, too, heading back towards 200p, boosted by news of defence orders, after slipping back to 186p last week. Smiths Industries also recovered strongly.

GEC was another engineering company to start winning back ground lost last week.

The Farnborough effect initially pushed British Aerospace 12.5p ahead to 397.5p, thanks to the effect of bullish remarks by the managing director of Airbus.

Next day, though, BAe had to contend with a report that the Saudi Arabians were cutting back the huge Al-Yamamah defence project, BAe’s biggest source of profits.

Depressed oil prices have cut the value of the oil with which the Saudis pay BAe.

Another casualty of the stock market shake-out to perk up this week was IMI, which put out a confident statement with resilient half-year profit figures. Previously its shares had nearly halved from a 52-week peak of 523p.