Talk of a bid from Nasdaq or the New York Stock Exchange helped London Stock Exchange to bounce 55p to £11.43, after a long slump all the way from £19.50.

Analysts in Sanford Bernstein, a key bear on LSE, cut their rating from “sell” to “neutral” on Thursday, saying that the shares were now low enough to make them affordable to the two acquisitive American exchanges. LSE also gained on the hope of stronger than expected full-year results next Thursday, which will be bolstered by its recent acquisition of Borsa Italiana.

LSE’s key shareholders from Dubai and Qatar bought at prices well above today’s level and are unlikely to want to sell, but the suggestion was enough to send short-sellers dashing for cover.

It was a similar story for Icap, the interdealer broker, up 24p to 659p, on a report of a rumoured bid from InterContinentalExchange, the commodities exchange in London. However, Icap is due to report full-year figures on Tuesday and they are expected to be positive after a bright statement on Thursday from the rival Tullett Prebon, up 7p to 495½p, which spoke of good market conditions.

With relief that British Airways, up 9p to 233p, was returning to paying a dividend and that British Energy, up 35½p, had received two bids at more than 680p, the FTSE 100 ended up 52.5 points at 6,304.3, having at one stage been up by 96.8 points.

In the FTSE 250, Rightmove lost 6¾p as Halifax, a shareholder, began placing its 13 per cent stake. Panmure Gordon said that this would make the property website an easier takeover target. Internet groups, such as Google, might be interested. However, Rightmove has cautioned that the number of its estate agency clients is set to shrink in the housing downturn.

Logica fell 2p to 125½p after Goldman Sachs cut the IT consultant to “sell”, saying that it had rallied too far after strong first-quarter figures that did “little to alleviate concerns about the outlook into 2009”. Goldman said: “We fear the lengthy and costly restructuring process ahead runs the risk of falling short of target.” Demand in the core UK market was slowing, it added.

Capital & Regional, the shopping centre developer, rose 20p to 355p after expressing confidence that its Mall fund, close to breaching covenants, would be bailed out by other investors — likely to include Aviva.

Trinity Mirror rose 11¼p as talk of predatory interest from Germany’s Axel Springer scared away short-sellers.

De La Rue, the banknote printer, rose 7½p to 867p on speculation that it will confirm at its update next Thursday rumours that it will sell its £450 million cash systems business, which makes cash tills, as part of its strategic review. Citigroup said that it also expected the company to sell its stake in Camelot, which runs the National Lottery, and to promise a “chunky capital return”.

Enodis, the maker of kitchen equipment, rose 9p to 298p, well above the agreed 282p offer price from Illinois Tool Works on talk that Manitowoc might come back with a higher bid.

— New York: Wall Street recovered from its intra-day lows to end narrowly mixed as investors squared concern about rising oil prices with a surprise jump in home construction. The Dow Jones industrial average closed down by 5.90 at 12,986.80.

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