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After a surprise 0.25 per cent cut to 3.75 per cent, UK interest rates are now at their lowest level since 1955, though this has done little to encourage a stock market that is beset by all manner of worries.

Although the Monetary Policy Committee's decision has been widely welcomed by the UK's beleaguered manufacturers, in truth it has only served to emphasise how much trouble many of them are in at the moment. The same goes for the technology sector, with worldwide corporate spending remaining depressed and little sign of it changing for the better.

But while all of this is rather dispiriting, it is noticeable that the level of corporate and buy-out activity is on the increase, both in traditional and high-tech sectors of the market.

Predators and venture capitalists are on the prowl for bargains, and many management teams seem more than willing to go along with them, depressed as they are by the lack of returns on the stock market.

Deal news

Just like Safeway, cash-rich biotech Oxford Glycosciences has found that getting one bid often forces other interested parties out of the woodwork. After agreeing to an all-shares offer from Cambridge Antibody Technology (the Morrisons of this affair), the group has now confirmed press reports that FTSE 100 group Celltech is on its case too, while adding that no actual offer has been received. In another similarity to the Safeway situation, it revealed that 'a number' of other parties have also made enquiries.

So, the potential is there for a real bid battle to develop, which should be fun for shareholders who have seen their stock rise 11 per cent to 192.5p already.

The situation is rather more clear-cut at Azlan, where the board recommended a 125p bid from TechData.

Meanwhile, Rolfe & Nolan announced that its non-executive board members have agreed to a 100p bid from a management team backed by HgCapital Funds. But there is competition here, too, with Cambridge, Massachusetts-based onExchange confirming that it is considering whether or not to make an offer, having had an 85p bid rejected last summer.

Plenty of speculation also continues to surround the bombed-out telecoms sector, with virtually every listed company (bar the biggest, like BT and Vodafone) said to be in the frame for all manner of corporate activity, but with management buy-outs very much on the agenda.

Results roll in

Results announcements have started to flow in earnest again after the pre- and post-Christmas lulls, with the rush of activity helping the techMARK All-Share index to climb three per cent to 696 since the end of January.

Dicom, the document capture group, continues to star, unveiling interim results that were depressed by foreign exchange losses but still showed pre-tax profits raised ten per cent to £4.6 million for the six months to December. That didn't stop its shares declining 10p to 400p, though.

Tech boom star Bookham Technology moved up five per cent to 82.75p, after showing-off the benefits of last year's fibre-optics acquisition from Nortel Networks. Fourth quarter revenues were up 88 per cent on the third, but cash burn hit £32 million. However, the Oxfordshire group ambitiously expects to break even in the fourth quarter of this year.

Meanwhile, virtually unheralded inkjet printing group Xaar has been one of the best performers on the whole market, having risen 57 per cent to 40p, with most of the gain coming before it released its final figures. Profits were in line with forecasts at £900,000, and WestLB Panmure has maintained its expectation for the Cambridge- and Sweden-based group to make £3 million pre-tax this year.

Innovation launches rights issue

The insurance industry's troubles have been well documented, so it is not altogether surprising that sector specialist software supplier The Innovation Group feels a need to raise more money. In a 1-for-1 rights issue underwritten by KBC Peel Hunt, the group is raising £9.2 million net for balance sheet strength.

Meanwhile, competitor Sherwood is releasing its finals on 3 March, having recently released a relatively downbeat trading statement. Analysts are generally positive about the group, though, with Baird's Ian Spence saying that the price fall following the warning was 'overdone', adding that Sherwood's strong cash position could make it 'highly attractive to a financial buyer'.