Evening Standard (London): Bookies look odds-on to land gambling law winner

ANYONE unfortunate enough to be listening in at, or even attending, this week's standing committee sessions on the Gambling Bill would have learned that the Government would rather keep fixed- odds betting terminals - essentially electronic roulette machines - in British betting shops, where they can keep an eye on them, than drive them offshore.

Some reckon the Government may even allow betting companies to install more fixed-odds terminals in their shops. This is good news for the likes of William Hill, which derives about 30% of its earnings from them. The nation's biggest chain of bookies has recently been one of the highest blue-chip climbers, pushing back towards a 12-month high of 560p.

Dresdner Kleinwort Wasserstein analyst Andrew Lee's target price of 625p doesn't just rest on the assumption that FOBTs will be retained but also on a better performance in the online division than is currently expected. He rates the shares a buy alongside those of online rivals Sportingbet and Paddy Power.

Moreover, he reckons William Hill's casino-owning rivals such as Stanley Leisure and Rank, which have recently enjoyed steady lifts as investors anticipate bigger and better casinos, may be getting ahead of themselves. He points out that under the proposed legislation only new casinos will be allowed to install Class A machines - the so- called Super Jackpots - not existing ones. His best tip is London Clubs International.

Deutsche Bank has followed rival Merrill Lynch and downgraded parts of the mining sector. Rio Tinto has been cut from hold to sell with seen its target reduced by 90p to 1300p. Deutsche pointed out that continued strength in iron ore, coal, copper and aluminium prices have benefited Rio's 2005-06 outlook.

It also noted the share price has responded to this and sits at a historically high premium to net present value. Other sector losers yesterday included BHP Billiton, Xstrata and Antofagasta.

Aerospace specialist Cobham plunged as brokers faced the prospect of lowering their forecasts for the current year after the group indicated profits would not exceed expectations.

Broker UBS has raised its recommendation on builders' merchant Travis Perkins from neutral to buy and lifted its 12-month target from 1466p to 1755p. UBS believes a part-purchase of Focus Wickes - namely, the non-DIY Wickes side of the business - would be good for sentiment, strategy and earnings.

Fire safety equipment maker Kidde was another strong performer after it emerged that United Technologies Corporation has renewed takeover talks.

Kidde has already rejected October's indicative offer of Pounds 1.38 billion but the two sides may well reach an agreement before the Takeover Panel-imposed deadline of a week tomorrow.

Investors are beginning to get excited about Photo-Me International ahead of next week's interims. Minilabs have proved to be the salvation of this company, once judged a dotcom calamity.

A temporary revival in the dollar's fortunes encouraged investors overnight on Wall Street, where the Dow rose 53.65 points to 10,494.23.

But trading in the Far East today saw share prices in retreat. In Tokyo, the Nikkei 225 closed down 164.74 at 10,776.63, while in Hong Kong the Hang Seng had shed 29.94 to 13,992.38 by the end of the morning.