Gilts

Despite rising inflation figures, speculation that the Bank of England would have to cut rates to stave off a recession helped the gilt market. Yields on ten-year benchmark government bonds fell five basis points to 4.42 per cent and the December gilt future was 42 ticks higher at 112.41, having set a contract high of 113.32.

Rumour of the day

Talk that Generali is mulling a bid for RSA Insurance intensified with suggestions of an indicative offer at 190p. RSA declined to comment. The shares lost 6p to 152.1p, in line with the sector. They rose on Monday when the sector was crashing and are up 26 per cent in the past two months. Allianz is regarded as another contender.

Deal of the day

Paddy Power, the Irish bookie, rose 23 cents to €12.63 despite Dermot Golden, its head of risk, selling 27,000 shares at €12.20 each. The price has nearly halved from €23 in mid-June. The bookmaker, which has pinned its hopes on the growth of online betting, gave warning last month that its operating profits for 2008 would be lower than expected.

Bet of the day

The bad news just keeps coming for Woolworths, which is expected to report a £90 million half-year loss today – the biggest in its seven years as an independent retailer. It has dropped from a high of 13p at the start of the year and closed down 0.76p at 6.06p yesterday. Spreadex has a December-based spread of 6.22p to 6.38p.

Tiddler to watch

ServicePower, the scheduling software group, has entered a deal with TomTom, the satellite navigation group, to integrate its software into TomTom’s devices, allowing users to download work schedules. The group, flat at 6¾p, has disappointed in the past but the partnership deal is an encouraging endorsement of its technology.

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