Market report: Tuesday close

KEEP an eye on high-flying

Turnover in the shares reached almost 300,000 in a tight market where market-makers will normally only make a price in 3000 at a time. But there is no doubting their strong showing since the start of May, having come up from the 220p level.

That is good news for shareholders of the wine warehouse company who took part in the group's £9.5m share placing back in January at 250p. They have been under some pressure since then, having seen the price come off the boil of late - a fall that has left the company and its followers mystified.

Over the past four years there has been no holding the company back and that has been reflected in the share price, which has soared from the 55p level boosted by strong sales growth, particularly over the Christmas period. Now there is talk that someone is testing the shares by building up a stake. At these levels, Majestic is valued at more than £160m.

Share prices generally were marked high in early trading but the Footsie gave up its gains later in the day. There was little response to the Non vote in France on the EU constitution. In London, it was the school half-term holidays that appeared to affect turnover levels.

The FTSE 100 index closed down 22.3 at 4964 as share prices ticked lower in New York this afternoon. The Dow Jones industrial average was down 48.38 points at 10,494.17.

Bank shares perked up on news that the German bank HVB has confirmed it is in merger talks with UniCredito Italiano - but gave up much of the gains in the afternoon. HSBC finished unmoved on 868p, Egg rose 8½p to 110p and Royal Bank of Scotland just 1p to 1616p.

Miners were also a firm market after the South African rand fell to an 8½-month low and China showed its economy was continuing to power ahead. Chinese demand for raw materials has forced the price of metals sharply higher during the past year. Antofagsta jumped 20p to 1156p, Rio Tinto 14p to 1632p and Xstrata 10p to 986p.

Services outfit Rentokil Initial slipped 6¼p to 147¾p on reports over the weekend that it plans to bid £650m for PHS Group, the washroom cleaner.

Water supplier Severn Trent fell 11½p to 1011frac12;p after broker Merrill Lynch downgraded the shares from buy to neutral, having exceeded its 1010p target price.

Over on Aim, shares of loss-making SP Holdings were suspended at 6½p pending clarification of the company's financial position. SP Holdings rose from the ashes of World Sports Solutions, which handled the affairs of stars such as Manchester United's Rio Ferdinand and went into liquidation three years ago.

Elsewhere on Aim, shares of Magna Investments were suspended at 2.38p pending an announcement. Last week the group unveiled plans to acquire Geneva-based Club Airways International. The deal is to be financed by way of a share placing.

Hamworthy, which supplies services to oil fields and the liquefied natural gas market, is another company that seems to be doing well on the back of a strong oil price. Its share price fell 7p to 221½p despite producing a 53% surge in pre-tax profits last year to £6.4m.

The group's order book has grown from £84.6m to £121m.