Market report: Friday close

REUTERS shot to the top of the Footsie leader board for a time today after an employee posted on a website an internal memo from chief executive Tom Glocer to his staff.

The shares were 11 1/2p higher at 346p after the memo, which referred to a budget meeting, concluded that senior management had 'confidently set a budget which will show Reuters to be growing in 2005'. This was at odds with analysts' consensus of flat revenues.

Reuters later put out a statement suggesting the employee's conclusions had been a little hasty. Glocer's message, it said, had been to 'encourage them to aim for growth in setting the 2005 budget' and did not constitute an update of prospects. Even so, analysts decided the sentiment was more positive than they had expected and the shares remained one of the top performers with more than 24m changing hands.

Merrill Lynch has slashed its forecast for J Sainsbury for the second time in five days after the struggling supermarkets chain indicated to the bank's analysts that its previous first-half forecasts were too high. The broker scaled back expectations of full-year pre-tax profits to £317m from £350m.

Investors are bracing themselves for bad news in 10 days when newish chief executive Justin King reveals his business strategy but the shares ticked up 1 1/4p to 252p.

The FTSE 100 drifted lower late in the day and only just managed to keep its head above water. It closed just 0.20 ahead at 4698.90.

Traders say drug stocks now look oversold following yesterday's routing by hedge funds. Despite fears that regulators may suspend an important class of anti-inflammatory drug, GlaxoSmithKline was up 24p at 1175p while AstraZeneca added 6p 2165p.

Kingfisher was also on the end of a broker downgrade. CSFB cut its rating from outperform to neutral and trimmed its pre-tax profit estimate for next year by 1.6%. The shares fell 4 1/4p to 311 1/4p as CSFB noted: 'On our estimates, Kingfisher remains on a 5%-10% premium-valuation to the UK peer group, which correctly balances its medium-term prospects, and some nearer-term delivery issues.'

Airports operator TBI climbed 4 1/2p to 73 1/2p as hopes rose that shareholders controlling a fifth of the company are pressing the board for a break-up. Investors believe the business, which includes Luton, Cardiff and Belfast International airports, would be worth more than £560m, or between 100p and 110p a share.

Property group Minerva fell 3p to 290 1/2p as broker JP Morgan warned the board not to accept offers below 360p a share. Minerva's latest triple net asset value per share, or break-up value, is 329p. It has whittled down its shortlist of bidders to four but the highest offer is believed to be just over 300p.

JP Morgan has a habit of being controversial but prescient. The broker last stuck its neck out on pricing a property developer's underlying value when it reckoned management was buying Chelsfield on the cheap. The company was sold earlier this year at 320p a share but Morgan thought the equity was worth 40% more.

Chelsfield's new owners were today considering a £585m bid from Australia's Westfield. That is some 45% more than management paid to take it private. The shares fell 1/2p to 319 1/2p.