Bid rumours boost for AMP

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The stock picked up 25 cents, or 3.8%, to A$6.92. The gains, which came amid a flurry of rumours about the likely next steps in the drama, took AMP's rise to almost A$2 since the affair came to the boil.

NAB electrified the market last week with its move to buy 10% of AMP, hoping to push its holding in the target company close to 15%. But with fund managers holding on to their stakes - for now at least - NAB came away with only an additional 2.25%.

NAB says its stake is 'strategic' and no general bid for AMP is planned until AMP has successfully divested its struggling British units.

That move depends on the green light from regulators, although AMP executives have repeatedly said the planned split is on track. The talk today was twofold: first, what happens if AMP fails to demerge its British businesses and, second, are there any other players that might take on NAB in a straight fight if general offers for AMP are eventually tabled?

On the first count, an Australian Press report today suggested AMP had drawn up a Plan B should the demerger fail to get off the ground.

A trio comprising South African fund manager Old Mutual, US-based buyout firm Kohlberg Kravis Roberts and a consortium including GE Capital had been shortlisted for talks if the demerger falters, the Australian Financial Review said.

Second, talk swirled that Westpac Banking Corp, one of Australia's big four banks, may be lining up a full bid for AMP. Westpac appears to be in an acquisitive mood as it is already in the hunt for the National Bank of New Zealand, put on the block by Lloyds TSB.

Westpac shares eased 18 cents, or 1.2%, to A$15.47, while NAB dropped 23 cents, or 0.7%, to A$30.86.

The wider market made gains - as did most of the rest of the region - amid expectations that global growth is set to accelerate.

Led by Rupert Murdoch's News Corp, up 30 cents, or 2.3%, to A$13.50, the All Ordinaries advanced 9.2 points, or 0.3%, to 3212.1.

It was much the same optimistic story in Japan, where buying was fuelled by a positive reading in the latest purchasing managers' index. The Nikkei 225 Average surged 326.63 points, or 3.2%, to 10,670.18, with carmakers and tech stocks showing the way.

Nissan Motor was better by 16 yen, or 1.3%, to 1269, while Toyota Motor put on 70 yen, or 2.2%, to 3290. Among the tech shares boosted by the more positive mood, Hitachi added four yen, or 0.6%, to 640 and chip-testing equipment maker Advantest firmed 250 yen, or 3%, to 8340.

Hong Kong's authorities also paraded better purchasing data this morning, spurring the Hang Seng index beyond 11,000 points. Off an early high of 11,011.96 points, the index was up 48.03 points, or 0.4%, at 10,957.02.

Aided by a strong recovery from the territory's first-half recession, developer Cheung Kong put on HK$1.25, or 2%, to HK$61.75, while conglomerate Swire Pacific was 20 cents better at HK$44,up 0.5%.