Gilts

Gilts rallied to a new contract high as more bad news piled up for the economy and oil prices held close to a three-month low, ahead of the decision on interest rates today. UK government bond future prices rallied as much as 40 ticks during the day before the September gilt future retreated slightly to close the day up 18 ticks at 107.93.

Rumour of the day

In a day of rumours for the beleaguered department store chain, Debenhams soared 7¾p, 15.6 per cent, to 57½p, as market speculation of a possible takeover bid from Baugur, the Icelandic investment group, swirled. Talk had it that the group, which already owns House of Fraser, was lining up an offer of about 70p per share.

Deal of the day

Mark Fryer and Peter Shillcock, both directors of Manganese Bronze, exercised share options, selling 60,995 and 52,118 shares respectively at 343p but holding on to 25,500 and 21,800. The shares rose 26¼p to 391¼p as it was revealed that Morgan Stanley held 26.41 per cent of the company and a Hermes fund held 13.2 per cent, stoking bid talk.

Bet of the day

After oil prices rose to nearly $150 per barrel recently, Brent Oil is now below the $120 mark, with many left wondering if black gold has already seen its peak. However, ChoiceOdds, the financial bookmaker, believes that the dip is temporary and that diverted money will return soon. It is offering 4-1 that crude will close below $120 per barrel on Friday.

Tiddler to watch

Leyshon Resources, the AIM-listed goldminer based in China, rose ½p to 20¾p after making the move from being a developer to its construction phase. Production is expected by the end of 2009, with mining in China cheaper than other parts of the world, costing $250 an ounce compared with the industry average of $500.

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