Update filed at market close

ARM Holdings’ share price reached its highest level since 2002 as London’s blue chip index closed today.

The chipmaker finished the day up 8.6 per cent at 633.8 pence amid renewed speculation of a takeover after Intel piled in to snap up Infineon’s wireless business.

Merger and acquisition activity in the sector has been busy over the summer and today’s move by Intel translates as good news for the company as Intel has committed to supporting ARM’s chip designs in spite of the takeover.

The sector is awash with additional M&A rumours, with Intel also recently having bid for computer security specialist MacAfee.

Competing technology companies are also looking to extend the levels of expertise within their businesses with IBM and Cisco all linked with or involved in deals.

The second highest climber was silver miner Fresnillo which climbed 3.2 per cent to 1,090 pence ahead of Randgold Resources, which gained 2.6 per cent to 6,080 pence.

Lower-than-anticipated bookings were enough for investors to lose faith in Intercontinental Hotels.

The hotels and leisure group lost 3 per cent at 982 pence after one of the company’s managers said businesses in Germany were shying away from its 5-star rated sites.

Serco was the second worst performer, down 2.5 per cent at 582 pence while BG Group was down 1.6 per cent at 1,049 pence.