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City market report.

A SUBDUED session on the London stock market came to a close yesterday with blue-chip shares easing into the red.

Initial gains faded through the morning and trading came to a close with the FTSE 100 index off 21.8 points at 3931.6.

The United States markets were marginally lower by London's finish but this had been widely expected by traders.

Subduing sentiment was concern about the political climate after the weekend bomb attacks in Bali, as well as light volumes.

City index trader Tom Hougaard said, ``There was some profittaking seen in stocks like Vodafone but all in all it was a quiet day with low volumes and directionless trading.''

However, Mr Hougaard said the market could have closed lower had it not been for strong gains by heavyweight stock AstraZeneca.

The Anglo-Swedish firm soared 272p to 2340p, a hefty 13pc jump, after a US court curbed generic copies of its blockbuster ulcer drug Prilosec.

The unexpected victory helped the sector and rival GlaxoSmithKline also moved ahead, up 25p at 1328p.

Looking forward, Mr Hougaard was optimistic.

``We are expecting a fairly quiet evening in the US which should benefit the FTSE for tomorrow as it makes another launch on the 4000 barrier,'' he said.

Supermarkets were heavy fallers in the City yesterday after a 47pc dive by FTSE 250 firm Somerfield. Chief executive Alan Smith is leaving and the firm said final profits were only likely to meet last year's level. Shares tumbled 45p to 50p.

Among the blue chips, Te s co was down 8p at 199p, Safeway lost 8.5p at 195.5p, Morrisons shed 8.75p at 196.25p and J Sainsbury fell 13.5p at 268.5p.

Heavyweight financial and insurance stocks were adding to the subdued mood as investors took profits, although concerns about the economic climate and equity slides also hit home.

Banking group Abbey National failed to hold earlier gains and closed down 4p at 618p. It had originally lifted amid reports that it would again reject Bank of Ireland's merger proposals. The Irish bank is reported to be preparing a new cash and share offer that would value Abbey at 750p a share.
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Title Annotation:Business
Publication:Western Mail (Cardiff, Wales)
Date:Oct 15, 2002
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