Market report: Tuesday 15.00

RE-QUOTED shares of nuclear power generator

They were re-quoted yesterday at 285p following completion of the debt-laden firm's financial restructuring which left ordinary shareholders diluted to just 2½% of the issued capital. The warrants shed 5p to 167½p.

Broker UBS has come out with a reduce rating and a 225p target while another broker warned the shares have further to fall. 'It's quite simple, the stock price is locked into the implicit value of the debt and the debt was overvalued,' the bank insists.

The re-quote for the shares came hard on the heels of a placing of 3.94m ordinary shares at a heavily discounted 255p and 8.07m warrants at 162p by banking giant HSBC, which said the issue had been almost seven times oversubscribed.

A rise in the oil price overnight and a closed Wall Street left share prices drifting. The FTSE 100 index fell 40.6 points to 4806.1.

UBS has raised its 12-month target for some of the big miners. Copper producer Antofagasta dipped 11p to 1130p despite UBS raising its sights from 1050p to 1200p while retaining a neutral stance. It also lifted its target on BHP Billiton, down 6½p at 635½p, from 625p to 700p, Swiss mining outfit Xstrata, 14p cheaper at 916p, from 925p to 1000p, and Rio Tinto, 15p lower at 1575p, from 1600p to 1750p. All three companies still command a neutral rating.

Merrill Lynch has been taking a look at the European drugs industry and has GlaxoSmithKline, off 6p at 1202p, as its main UK pick. Its target is raised from 1350p to 1400p.

'As earnings growth in the broader market begins to slow, and investors look to position themselves away from cyclically exposed sectors, we believe the pharmaceutical sector will begin to appear more attractive?, says Merrill.

UBS has also been giving Glaxo the once-over. It has repeated its neutral rating but tweaked up its target from 1130p to 1155p. Rival AstraZeneca was 10p lower at 1887p, still overshadowed by institutional shareholder criticism of chief executive Sir Tom McKillop's £2.2m pay package. The bonus added to his £885,000 basic pay is set against a sharp fall in the share price, which has dropped from a peak of 2749p last year.

Cookson marked time at 36½p after delivering a fairly upbeat trading statement. The metals technology group has identified more than £100m of disposals which will help reduce debt and leave it to focus on the key areas of electronics, ceramics and precious metals.

InterContinental Hotels was down 3p at 671½p after broker Panmure Gordon began coverage with a buy rating and 740p target. Panmure pointed out that Intercontinental has focused on improving returns and said it believes there is more to come. It also sees potential for a £750m special dividend and an acceleration of its share buyback after further disposals.

In Panmure's view, InterContinental is a bid target as it would be a good fit for US franchisers such as Marriott, Choice or Cendant.

Broadcaster ITV, the speculators' current takeover favourite, rallied from an opening fall to trade ¼p better at 115¾p.