Gossip turns Comet group Kesa into a star performer

IT HAS not been everyone's cup of tea since demerging from Kingfisher in July - because of its heavy gearing towards the French economy and the euro - but

Demand was also stimulated by gossip that the long-awaited outcome of the Office of Fair Trading's investigation into extended warranties will be published before the end of the week. Dealers heard that its findings will not be as bad as first feared.

At the end of September, the Competition Commission handed a 1,300-page report on its 15-month probe to the Department of Trade and Industry which said it would announce a final ruling within 45 working days.

The report is expected to restrict sale of warranties and will allow customers a 'cooling off' period, entitling them to a refund if they cancel within 60 days. Cancellation after that would be possible with a refund linked to the length of the warranty period remaining.

Rival Currys-to-PC-World group Dixons has a huge exposure to extended warranties which account for up to 30% of its UK profits. It closed 2 1/2p better at 134p after analysts gave the thumbs up to its decision to sell 48.4m shares in French internet provider Wanadoo for £208m, or 10.7p per share. Dixons will retain 37.5m shares, worth £161m or 8p per share.

Buoyed by Wall Street's overnight gain of 119 points, the Footsie advanced to a 15-month high of 4409.4, but then ran out of puff. It later drifted in sympathy with a weaker opening in New York to close only 6.3 points better at 4388.7.

The Dow Jones was seemingly unimpressed by a strong upward revision to US third-quarter gross domestic product, which showed the US economy grew at an annual rate of 8.2% in the third-quarter - the fastest in nearly 20 years.

Bradford & Bingley closed 6 3/4p higher at 310 1/4p on revived Barclays bid talk. Barclays moved up 8 1/4p to 505 3/4p after SG Securities upgraded from hold to buy.

Granada boss Charles Allen will try to curry favour with investors by promising higher savings from the merger with Carlton when today's 12-month results are unveiled.

The ITV duo had originally identified £55m of savings, but will increase this to around £80m. Granada improved 3/4p to 118 1/2p while Carlton rose 4 1/2p to 222p.

Still excited by rumours of a 350p-ashare cash bid from Barry Diller's InterActiveCorp, lastminute.com jumped 22p further to 266p.

Investment banks reflected the healthier market trend. Investec, also ahead of tomorrow's interim figures, rose 45 1/2p to 1055p, while Collins Stewart Tullett gained 16p to 417p.

An Evolution recommendation in the wake of better-than- expected third-quarter revenues lifted smallpox vaccine-maker Acambis 10p to 305p.

Antisoma fell 3 3/4p to 40 1/2p following a £15m fundraising and placing of 38m shares at 40p. But the cancer drug developer said it would not make a profit for some time as the cash is earmarked for research costs.

Aim-quoted video games software developer Bits Corporation jumped 13/8p to 5 1/2p after returning to the black at the interim stage.

Transense Technologies advanced 5 1/4p to 57 1/4p on news of a deal with Belgium's Melexis Microelectronic Integrated Systems.

Lambert Howarth marched 24 1/2p forward to 262p in a thin market after being awarded a licence by Nicole Farhi to manufacture the French designer's exclusive shoe collection for launch in autumn 2004.

A shock profits warning left Secure Trust Banking 58 1/2p down at 469p. It blamed weaker-than-expected revenues from its trading in small and mid-cap shares and uneven income from corporate finance mandates.