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Market Watch

FINANCE

SHARES in Amec surged to their highest price since the spring last week on rumours of a 400p-per-share offer for the contracting giant. Two US firms have been touted as possible bidders.

Stephen Rawlinson, analyst at broker Arbuthnot, said: 'There is no doubt that Fluor Daniels and Jacobs Engineering could use their highly rated paper to fund a bid but we are sceptical.

'As for other bidders, again we doubt there is a player waiting in the wings with a bid that is near 50 per cent higher than the recent trading level but we could be wrong.Without a bid at 400p the price is up with events.'

Amec's rise helped lift contractors in the FTSE Construction index up an average of 4.4 per cent but worries over the housing market left the house builders off 3.7 per cent.

Elsewhere, Johnston plun-ged to a 12-month low after the materials group issued a profits warning.

Johnston said that recent tough trading was continuing. A downturn in the UK concrete market, which started this spring, has hit margins at the pipeline arm.

On the junior markets there was finally respite for shareholders in Montpellier after the contractor pulled out of a controversial animal testing project in Oxford (see Agenda, page 14) that had seen staff targeted by animal rights protesters.

Also on AIM, Wigmore finally revived after Global Investments took up a 22.3 per cent stake in the mini construction conglomerate, which has a staggering 783 million shares in issue.