Standard Chartered closed at a record high on nearly four times the normal volume traded yesterday, amid revived talk of Chinese stakebuilding.

The shares gained 118p to £19.14, valuing the Asia-focused bank at £27 billion. There had been talk recently that Chinese state-owned banks were trying to persuade Temasek to sell them its 17 per cent stake, although Temasek has resisted this.

But some traders said the move was also down to a reshuffle of the MSCI Barra index of globally traded stocks which is including Standard Chartered. Brokers were also closing short positions ahead of a trading statement on Wednesday. Many have their year-ends at the end of November and do not want debtors or creditors outstanding on their books. This, combined with speculation on rate cuts in the US and the UK next week, helped the FTSE 100 to close up 83.4 at 6,432.5.

Although the three-month inter-bank lending rate rose again, from 5.83 per cent to 5.95 per cent, banks in general benefited from the interest rate speculation and broker upgrades. Royal Bank of Scotland, up 15¾p at 459p, was also helped by Sanford Bernstein reiterating buy advice, saying that it expected a £1.9 billion sub-prime-related writedown, which was dwarfed by its £19 billion fall in market value this year.

Alliance & Leicester was up 44p at 730p, despite a mixed review from analysts following Credit Suisse’s £4 billion rescue loan. Deutsche Bank cut its target price to 625p.

Rank Group fell 7½ to 100½p despite speculation on bid interest from Guoco, the Singaporean investment firm that controls Thistle Hotels. Word is that Alistair Darling has begun lending a sympathetic ear to the industry’s plea to scrap VAT on bingo, which would increase the chances of a bid.

Oil stocks such as Tullow Oil, up 35½p at 671p, benefited from Burren Energy agreeing a bid from Italy’s Eni. Tullow’s entrance into the MSCI index also took place yesterday. Burren rose 107p to £12.49, above the £12.30 bid price, amid speculation that Mittal or another bidder could enter the fray. ENI’s original offer, rebuffed by Burren, had been £10.50.

Imperial Energy, the Russian oil explorer, was up 107p at £14.03. Cairn Energy gained 37p to £23.49 and Premier Oil was up 38p at £12.96. Both are seen as potential bid targets. Vedanta, the Indian miner was lifted by continuing speculation of Chinese interest, up another 112p at £23.04.

Kingfisher was the worst performer, off 3.42p at 152.3p after Citigroup gave warning of trouble ahead for B&Q. COLT Telecom was up 27¾p at 182¼p on a report that its majority shareholder Fidelity was trying to engineer a sale at 300p to AT&T. COLT said it knew of no reason for the rise and it should know since its chief executive was hired from Fidelity.

Michael Page gained 17¼p to 326¼p and Hays rose 2¾p to 127¼p after Vedior, the Dutch recruitment group, said that it had received an approach from its compatriot Randstad. Adecco, the Swiss group, is seen as a predator for Hays or Michael Page.

New York: Wall Street ended a volatile week and month with a comparatively mild performance, closing mostly higher on encouraging words from the Federal Reserve Chairman. The Dow Jones industrial average finished 60.00 points up at 13,371.70.

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