Market report: Wednesday close

ANOTHER day, another encouraging oil find for

It said it had carried out tests between Mangala-1 and Mangala-4 to assess how deep and how wide the reservoir between the two wells is. Chief executive Bill Gammell says the results of the tests 'reinforce our confidence' for the future of the Mangala development. Test drilling of a further two wells is due to start later this month.

The shares, which have climbed from a low of 380p earlier this year on prospects for Rajasthan, responded to the news with a rise of 30 1/2p to end the day at 1085p. Traders say Cairn may even challenge for a place in next week's quarterly reshuffle of the top 100 companies if it can maintain its current pace.

The oil explorer is currently worth £1.62bn and Deutsche Bank says it is still undervalued. It has upgraded the shares from hold to buy with a target price of 1200p, which would value the company at £1.8bn. Investment bank Canaccord, which specialises in oil flotations, recently pitched its yearend forecast at 1500p.

Cairn is 12th among those looking for promotion to the Footsie 100 in next week's quarterly review.

Oil services provider Expro International fell 7 1/2p to 262 1/2p after saying there was little sign of an upturn despite sky-high crude prices. Expro is struggling as its major clients defer new exploration and production programmes. It dropped into the red last year.

Share prices shrugged off worries about the soaring oil prices ahead of tomorrow's meeting of Opec ministers. Underpinned by modest opening gains for the Dow this afternoon, the FTSE 100 index closed just 0.01 points higher at 4422.8 in another day of thin trading.

US stocks also rose slightly as expectations of a solid jobs report on Friday offset concerns over record high oil prices. In early trade this morning the Dow Jones Industrial Average was up 8 points at 10,210.38. But the Nasdaq Composite Index was down 8.91 points at 1,981.86.

There was further heavy turnover in Marks & Spencer with 60m shares changing hands. Shares rose 1/2p higher to close at 366p. Dealers expect Philip Green's consortium to present terms of around 400p a share to M&S's new management tomorrow.

MFI stood out with a rise of 7 3/4p to 156p on revived talk about a possible management buyout worth between 185p and 190p a share. For weeks there have been mutterings that the company may be split in two with the shops sold off, leaving management to concentrate on its Howdens joinery arm.

Mears Group, which makes most of its money refurbishing and servicing council properties as part of the Government's pledge on housing, rose 5 1/2p to a record 185p. Chairman Bob Holt told the AGM that business is booming and profits this year will exceed expectations.

Mears' own broker, Arbuthnot, has repeated its buy advice and says revenues for 2004 will exceed its forecast of £150m. It has raised its pre-tax profit forecast from £6.4m to £7m.

Publisher and exhibitions provider United Business Media rose 11 1/2p to 450 1/2p after broker Merrill Lynch issued a buy recommendation and set a target price for the shares of 620p.

Shire Pharmaceuticals advanced by 6p to 502p as Morgan Stanley repeated its underweight stance on the shares while cutting its 12-month target price from 530p to 510p.

Mineral explorat ion group Vane Holdings started trading on Aim following a placing at 11p and traded at 12 1/4p.