Market report: Friday close

THE world's biggest mobile phone operator,

DKW has raised its forecast for operating earnings per share for the current year by 5% to 8.4p and dividend growth rate expectation from 15% to 25%. It says Vodafone has the most conservative price volume assumptions in Europe. Further cash may be returned to investors by way of share buybacks.

The broker has cut its forecast of group capital spending by £3.5 billion, or 10%, to the end of the decade. That, it concludes, will push up free cashflow assumptions by 5.2% to £6.45 billion this year and 10.5% in 2009-10. Margins may also improve by around 1%.

BP slipped 1/4p to 426 1/4p after failing to impress at yesterday's presentation that focused on its joint venture with Russia's TNK. DKW has repeated its reduce rating along with HSBC Securities. Deutsche Bank rates it a hold while reissuing its 433p target price. Credit Suisse First Boston has gone out on a limb with an outperform rating and 500p target. JP Morgan also rates BP outperform.

The wider market generally traded in narrow limits. The FTSE 100 index managed to keep its head above water and closed up 4.3 at 4344.0 as Wall Street opened lower. Blue-blooded broker Cazenove is reckoned to have held a presentation for fund managers yesterday and told them it expects the market to be 20% higher by the end of next year.

Rolls-Royce rallied 6 1/4p to 183 3/4p after Cazenove turned buyer.

Legal & General firmed 1 1/4p to 104p after broker UBS repeated its buy recommendation and raised its target from 115p to 118p ahead of the insurer's new-business figures next week.

Fund manager Amvescap retreated 9p to 499p though DKW has raised it from sell to reduce and lifted its target 10p to 480p on valuation grounds and signs of improved performance.

Multi Group returned from suspension 3 1/2p lower at 6 1/4p after announcing plans to raise £1.57m by way of a placing of 135m new shares at just over 1p with Southwind, the private vehicle of financier Bob 'The Bear' Morton and several other investors that include Sage Group's Michael Jackson.

Morton and Jackson will end up owning 54%, but they will not be forced to make a full bid for the company. A further £465,000 will be raised by issuing an extra 22.4m new shares to directors of the loss-making tool hire group which yesterday reported bigger pre-tax losses last year, of £1.15m.

Internet shares wobbled. Online auctioneer eBay reported a leap in third-quarter profits of 69% to £62m but warned of an unsettled outlook. That left Lastminute down 7p at 285p.

Cavanagh returned from suspension 10p lower at 170p after warning of full-year losses. The independent financial adviser is paying £3m for Ernst & Young Financial Management. A further £1.2m will go on deal and transition costs.