Rights issue scramble lifts easyJet

GETTING any kind of fundraising away in this market is no mean feat.

EasyJet touched 387 1/2p on the news before closing 8 1/2p higher at 379 1/2p on turnover of 4.3m. Analyst Chris Avery, at JP Morgan, rates it a 'buy', but warns that the airline will probably have to seek further funding towards the deposits on its forthcoming aircraft order.

Before being sidetracked by the Go acquisition, Haji-Ioannou had been in talks with both Boeing and Airbus on orders for as many as 75 new narrow-body jets. Go was known to be negotiating for up to 45 aircraft. Avery believes easyJet could therefore in the autumn give an order - to Boeing - for at least 120 jets. That would make it the largest aircraft order this year. EasyJet should get a volume discount, but would still need a lot more cash. Haji-Ioannou might have to unload some more family stock.

British Airways lost an early gain of 10p to close 4 3/4p lower at 172 3/4p. Avery reckons BA is oversold. It is trading below asset value of around 200p and he sees no risk of bankruptcy.

The blue-chip FTSE 100 flattered to deceive. It rose 34.8 points before being swamped in a sea of red caused by ongoing accounting concerns. It ended 58.4 points lower at 4542.9.

Nerves were further frayed by confirmation that a team of managers at engineer ABB had been sacked after allegedly trying to hide losses for two years. As President Bush called for tougher criminal penalties for company executives convicted of fraud, Wall Street rallied but ended deep in the red. Sterling rose to $1.5454, with the euro at 64.2p and 99.29 cents.

Oil giant BP, the UK's largest company, lost 8p to 546p. It had to issue a strongly-worded rebuttal to allegations by US Democrat Edward Markey that it was one of several groups engaged in a 'world- class accounting scandal'. Markey alleged that companies with interests in Alaska's North Slope oilfields had refused to disclose the full costs of their clean-up liabilities.

Vodafone eased to 88 1/4p before closing 3 1/4p off at 92p. Disappointing subscriber growth figures from its JPhone subsidiary in Japan sparked fresh selling. Vodafone pooh-poohed speculation that it is considering acquiring the minority 48% stake in Greek mobile phone operator Panafon.

Accounting worries continued to plague the support services sector. Capita was sold down to 261p before closing 8p off at 276p. Serco fell 25p to 160p. Amey crashed 39p to 88 1/2p for a two-day decline of 55p since warning that wrangles over the £13bn contract to refurbish London Underground may depress profits.

Anite, the IT consultancy once on Amey's shopping list, plummeted 19 3/4p to 59 1/4p. It warned that first-half pretax profits could be lower than last year's due to increased research spending.

News that first- quarter sales had doubled to £3.2m helped Big Yellow Group, which operates 20 storage centres in southern England, to rise 6p to 89 1/2p. It plans a 15% share buyback. Steel company Precoat International jumped 13p to 83 1/2p after agreeing the £6.2m sale of CSI, its Canadian offshoot, to Color Steels Holding Corp. Precoat proposes to return up to £5.9m to shareholders via a tender offer by broker KBC Peel Hunt at 95p.