Hat-trick puts new sparkle in Footsie

SHARES moved into overdrive after UK and euro-zone interest rates were slashed by half a percentage point. Taking their cue from the Fed's aggressive lead on Tuesday, the Bank of England cut domestic rates to 4%. Not to be outdone, the European Central Bank soon made it a hat trick by surprisingly reducing its main refinancing rate to 3.25%.

The co-ordinated moves to help stave off a global recession lifted Wall Street 167 points in the early stages and kicked the Footsie 78 higher at one stage. It closed up 61.8 points at 5278.1.

With the cost of borrowing in the UK down to its lowest level since 1964 and mortgage rates falling below 5%, housebuilders erected good gains. Barratt Developments rose 8p to 328p, Bellway 9p to 395 1/2p, Berkeley Group 33p to 631p, Persimmon 7 1/2p to 312 1/2p, Wilson Bowden 25p to 720p and George Wimpey 6 1/4p to 185 1/2p. Scottish housebuilder Bett Bros jumped 29p to 260p, helped by good annual results.

Hopes that Joe Public could now be tempted to spend more money in the shops this Christmas buoyed retailers. Burberry fashion and mail order group Gussies firmed 16p to 531p, Kingfisher 18p to 372 3/4p, Marks & Spencer 4p to 318p, Mothercare 13p to 228p, Woolworths 3 3/4p to 45 1/4p and JJB Sports 18p to 462 1/2p.

Speculative buying on talk that 20% Icelandic shareholder Baugur is on the verge of bidding 300p a share, helped Top Shop retailer Arcadia advance 10p to 250p. Jeweller Signet sparkled with a rise of 10 3/4p to 75 1/4p. It has yet to see any impact of the 11 September terrorist attacks on its UK business.

Sales in the UK during the third quarter rose 7.2% to £86.5m. However, in the US, which accounts for two-thirds of total turnover, sales fell 4.4% to £182.3m. Dealers said it could have been a lot worse.

Text messaging giant Logica soared 83p to 851p after confounding the pessimists with an encouraging trading update at the annual general meeting. Chairman Sir Frank Barlow said it is on track to deliver a strong financial performance for the full year to June 2002.

Reports that ITV Digital, which has struggled to compete with its big rival, BSkyB, wants to cut the cost of its £315m contract with the Nationwide Soccer league, lifted joint owners of the ITV sports channel. Granada gained 14 1/2p to 155 1/2p and Carlton Communications 32p to 247p.

Buyers switched on selected radio stocks. GWR, which owns Classic FM, rose 29p to 247 1/2p. Capital Radio, with results due on November 15, rose 35p to 747 1/2p.

Chrysalis, which owns the Heart and Galaxy stations, rose 19 1/2p to 213 1/2p ahead of annual results on 22 November. One rumour suggested Chris Wright, co-founder, chairman and controlling 28.7% shareholder, is looking for a buyer for his stake. On the verge of selling QPR for £8m plus, Wright apparently wants to spend more time on his Gloucestershire stud farm.

Citigate and Dewe Rogerson financial PR group Incepta jumped 7p to 43p. Broker HSBC was a big buyer.

Energis, the alternative telecoms carrier, buzzed 7p higher to 90p. Almost 43m shares were traded amid talk of a possible bid from cash-rich Cable & Wireless, 23 1/2p better at 348 1/4p.

Colt Telecom, once thought to be on C&W's shopping list, added 7 1/2p at 147 1/2p. Punters lost their dough when baker Greggs fell 92 1/2p to 3142 1/2p after confirming it is not in bid talks.

Harry Potter cast a spell over Character Group , pushing the merchandising company 14 1/2p higher to 31p. Character is believed to have won a UK distribution contract for a limited range of Harry Potter gift items.

Character overestimated demand for Star Wars merchandise and suffered a big loss. Harry Potter is different. Sales are soaring ahead of Christmas.

Aim-listed Invox more than doubled to 2 3/4p on heavy turnover of 10.8m. It supplies ringtones and logos to mobile phones, returned to profitability in the first-half and current trading is strong.