Many engineering shares came into their own last Friday when the 250-share index, which includes most medium-to-large engineering companies, hit an all-time high, gaining 2% on the day, although still outpaced by the 100-share index which scored its biggest one-day advance.
T&N led the charge, rising by 60.5p to 242.5p on news that Federal Mogul, the US motor parts maker, slightly smaller than T&N, was seeking an agreed bid at 235p. But the stock market rapidly concluded that T&N was likely to attract a larger bid. That view persisted after the weekend when the shares quickly pressed on towards 255p.
British Aerospace, by contrast, was left out of last Friday’s euphoria, amid fears that the affair of the two British nurses in Saudi would damage relations with BAe’s biggest customer. There were also worries about foreign secretary Robin Cook’s ban on two arms deals with Indonesia, although BAe was involved in neither.
This week, though, the shares bounced back strongly in hectic dealings.
GKN, Smiths Industries and TI were among the leaders on Friday and then went on higher still when the stock market took a breather early this week.
They were seen as companies which stand to benefit heavily if the pound eases back permanently after the report that the Government is poised to commit Britain to the single European currency sooner rather than later.