Bears take a swipe at ailing Vodafone

CONVINCED that

City bookmaker Financial Spreads slashed the odds on the number of days before it trades below £1 to 25 (to sell) and 30 (to buy). Ten days ago, the odds were 140-145 days.

After recent dire trading statements from Nokia and Ericsson, dealers obviously fear the worst. Consensus analyst forecasts suggest Vodafone will show that it added just 2.2m subscribers for the three months to end-March, giving it a total of 102m customers. Over the same period last year, it had signed up almost double that number. Mobile penetration is near saturation and average revenues per user remain flat.

Rubbing salt into its gaping wounds was news that Verizon Communications - Vodafone's partner in its US mobile phone joint venture, Verizon Wireless - had incurred a first-quarter net loss of £346m and slashed its 2002 earnings forecast.

With Vodafone accounting for 14 points of its fall, the Footsie lost 30.5 points to 5191. Wall Street dipped 36 points following disappointing firstquarter figures from ExxonMobil and DuPont, but soon rallied to trade 40 higher. Buyers were encouraged by Fed chairman Alan Greenspan's comment that there were signs of a recovery in business capital spending, although not at a rapid pace.

British Telecom was dragged 8 3/4p lower to 263 1/4p. Demerged mobile phone unit mmO2 rallied 2 1/4p to 51 1/4p after US broker Goldman Sachs advised clients the stock is oversold.

Scottish Power sparked 6 1/2p higher to 390 3/4p and Scottish & Southern Energy 5 1/2p to 654 1/2p amid speculation that the two utilities might decide to climb into bed together now that National Grid (8 1/2p down at 496 1/2p) and Lattice (6 1/2p easier at 185 1/2p) have agreed a £14.8bn merger.

John Ritblat's property group, British Land, advanced 17p to 582p following speculation that fund manager and 2% shareholder Laxley Partners is proposing that shareholders be allowed to vote on buyback proposals at the agm in July. Laxley is apparently proposing that BL buys up to 10% of outstanding shares at 700p or a price equal to 90% of the diluted net asset value per share.

Mortgage bank Northern Rock rose 15p to 701 1/2p and Alliance & Leicester 15 1/2p to 918p amid vague rumours of a possible merger. A&L lost its fiveyear protection against a takeover on Sunday.

Music giant EMI was friendless at 318p, down 12 3/4p. Robbie Williams has still not renewed his contract with the ailing British recording giant since it expired in February. EMI is rumoured to have offered Williams £40m to stay with the label, but Williams is dragging his feet. EMI simply cannot afford to lose its number one star and earner.

Awaiting the outcome of debt-to-equity swap talks, TeleWest Communications firmed 1.55p to 11.6p on turnover of 51m. Nervous selling ahead of tomorrow's first-quarter figures left Autonomy 25p off at 310p.

Still reflecting last week's bumper first-half figures, trendy fashion group Arcadia rose 15p to a peak of 400p. New Look improved 9p to 252 1/2p.

St Ives, the book and magazine printer, fell 30p to 430p after reporting that first-half profits before exceptionals almost halved, from £30.7m to £16.6m. Chairman Miles Emley described trading conditions as 'more challenging than at any time in the group's history'.

Universal Salvage, the vehicle salvager, crashed 253p to 215p on a profits warning. Underlying profits will amount to £7.2m because final-quarter trading has been below management expectations and below last year.

Stephen Dean's Aim-listed builder Artisan (UK) edged up 1/2p to 8 1/4p following an upbeat trading statement.