This phenomenon, known in the market as a "bear squeeze", can quickly cause investors spiralling losses.Finally, Telspec ticked 0.75p higher to 18.5p after the telecoms equipment maker put itself up for sale.. Elan has been an easy target for short sellers after it suspended its all-important Tysabri drug for multiple sclerosis on safety grounds. But an upgrade of Elan by the US broker AG Edwards has led to hopes that Tysabri could soon find itself back on the market. Should this prove to be true, Elan shares are likely to soar as all those short of the stock rush to close their positions. Shares in the energy group have been suspended since the middle of September pending completion of the deal.
Gossips reckon this process should be finished before the end of this week.Elan Corp rose €0.82 to €8.97 as dealers reported a rush by bears of the stock to close their positions. According to wire reports, senior executives from the Japanese company, which holds a 20 per cent stake in Pilkington, will soon be in London to discuss the proposal.At the smaller cap end of the market, Cambrian Mining, off 2.5p at 127p, was said to be putting the finishing touches to a deal which will see it transfer its coal assets to the AIM-listed Coal International. Vodafone closed 15.75p lower at 129.25p on volume of £1.4bn, a record number. Cable & Wireless retreated 3.75p to 119.5p, and BT Group dropped 3.5p to 203.5p.In the retail arena, House of Fraser ticked 1p higher to 106p in heavy trading amid rumours of a private-equity bid for the departments store group. HoF shares have performed well over the past four days, with some suggesting that the privately owned Debenhams might be tempted to make a move on the retailer.Analysts, however, were sceptical of an offer emerging for the group before the key Christmas trading period.
Woolworths gave up 0.25p to 35.5p as Nick Bubb, at Evolution Securities, played down talk of a bid for the retailer.Pilkington ticked up 3.75p to 153.25p on hopes Nippon Sheet Glass will increase its offer for the UK group to 162p a share from its previous 150p. In the same sector, Premier Oil added 18p to 745p after boasting of an oil discovery at its site offshore Mauritania.The FTSE 100 dropped 30.4 points to 5,439.6, despite gains on Wall Street. To blame was Vodafone's profits warning, which not only knocked £9bn off the company's market value but also weighed heavily on sentiment towards the wider telecoms sector. The broker said it was confident S&N can meet its growth targets and set a 600p price target on the stock.PartyGaming rose 2.25p to 95.75p thanks to HSBC Securities, which was heard to have started coverage of the online poker operator with a "buy" rating and a 122p price target. According to HSBC, PartyGaming remains very much a growth company in what is still a fast-growing sector.Elsewhere, dealers reported heavy demand for BG Group, up 2.5p to 537p, reigniting rumours of a possible bid for the oil and gas explorer.
