Gilts

Gilt futures rallied for a second day, in line with global bond markets and as investors bet that the Bank of England would present a dovish outlook for policy in its economic projections today. December gilt futures settled 46 ticks up at 117.24, outperforming the equivalent bund by a few ticks, recovering its losses from last week.

Rumour of the day

Are we on the cusp of a resurgence in global technology mergers and acquisitions? Either way, Jonathan Imlah, an Altium Securities analyst, believes that Aveva remains a prime candidate in a consolidation scenario. The broker suggests that the group will report an 8 per cent fall in first-half revenues to £68.6 million tomorrow.

Deal of the day

Shares in Mariana Resources rose 1¾p to 14p after the AIM-listed goldminer said that it had raised at least £2.6 million in a share placing to fund the exploration of its Calandria South project in Argentina. The group gave an encouraging initial assessment of the asset last month, indicating that there was plenty of gold close to the surface.

Mariana Resources

The Bank of England publishes its quarterly Inflation Report today. Will the level remain within the 2 per cent medium-term target? Higher petrol prices and the reversal of last year’s VAT reduction have led some analysts to warn of rising future inflation. How will sterling react? Spreadex has a Spot Cable (GBP/USD) quote of 16700c to 16703c.

Tiddler to watch

Kewill rose 6½p to 99p after the software group reported a 48 per cent rise in interim profits and raised £7.5 million in a share placing to fund acquisitions. KBC Peel Hunt said the positive first-half performance, coupled with recent newsflow on contract wins, meant that the company was on track to meet full-year expectations.

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