Market report: Tuesday close

The royal broker believes there is a potential for recovery in profits in the forthcoming period, with passenger numbers increasing after two weak years. The shares gained 11p to 280p.

Rival easyJet rose 1/2p to 309 1/2p and airports operator BAA put on 1 1/2p to 525p. Cruises operator Carnival firmed 9p to 2376p ahead of first-quarter results on Thursday.

Tomorrow's Budget was still exercising minds following reports that the Chancellor may end the 2002 concession that allows small firms a 100% tax break on the purchase of software, hardware and telecommunication equipment in the year of purchase. Accountancy software group Sage is the biggest beneficiary of such breaks in the UK but its shares rallied 1 3/4p to 177p.

Defence stocks were edgy ahead of the Budget although BAE Systems rallied 6p to 193 1/4p and Rolls-Royce improved 3 1/4p to 210 1/4p.

Computacenter was optimistic about the recovery in the IT sector as it posted a 28.8% rise in 2003 revenues to £2.48bn. The final dividend is upped 20% to 5p and the shares rose 3 1/4p to 432p. The opening of the Cheltenham Festival muted trading, the FTSE 100 index falling below 4400 before rallying on the back of Wall Street to be ahead 16 points at 4428.9.

Oil shares began to recover from the setbacks of the past few trading sessions as crude prices raced to year highs on Wall Street overnight.

Talk that Opec may cut back production sent BP up 1p to 449p.

After the board changes of the past few days led by the shock departure of chairman Sir Philip Watts and exploration director Walter van de Vijver, Shell stayed at 368 1/2p, despite talk that the oil giant may go for a spectacular shake-up that could involve an amalgamation of the British and Dutch boards.

The market believes more heads will roll in the wake of the row about the restatement of its oil reserves, especially after the annual report comes out next Friday.

Merrill Lynch believes Smiths Group shares are worth 738p based on what General Electric paid for its main rival in detection and protection devices, and Smiths shares rose 1p to 646p. Deutsche Bank has picked BHP Billiton as its top mining stock, pinpointing its petroleum growth pipeline and setting a 580p price target. It climbed 7 3/4p to 491p.

Better-than-expected drugs sales pushed Celltech earnings and royalties up 12% to £353.3m in 2003, giving the biotech group a 30p boost to 430p.

London's last independent merchant bank, Singer & Friedlander, slipped 1 1/2p to 236 1/2p despite the chairman of Icelandic bank Kaupthing, owner of a 19.5% stake, deciding to relocate to London to oversee expansion. Insiders believe that Belgian bank KBC could eventually bid.

Some 6.87m shares in mining giant Anglo American, were placed by Merrill Lynch at 1270p, dealers said. Its shares fell 20p initially before rallying to 1297p, a 9p gain.

Broker Hoare Govett placed 6.35m shares in broadband network Easynet at 130p to help fund its £26.2m takeover of Dutch rival Novaxess. Marconi placed its 40% stake in Easynet six months ago at 127p. The shares today slipped 8 1/2p to 130p.