A London stock market awash with takeover stories - some true, some believable and some rather dubious - ultimately disappointed the legions of small investors who have been recently driving daily trading volumes to record levels. An unconvincing opening by Wall Street, plus a sharp reversal by Marks & Spencer, Britain's premier retailer now seen as under bid siege, undermined an initially promising market.

At the close, the FTSE 100 index, which raced up to within 5 points of its intra-day peak in mid-morning, had fallen to its lowest of the day, off 28.8 at 6,710.7.

The Marks & Spencer "takeover" story continued to grip the market's attention, the shares surging about 7 per cent during early trading only to reverse later in the day.

Telecoms stocks, heavily bought recently, were also on the slide. Turnover in equities, normally depressed on Mondays, was a healthy 1.6 billion shares, with Vodafone AirTouch and Marks & Spencer leading the pack.