Home Retail Group slumped as it began to look as though Sainsbury’s might not be able to agree a takeover price with the Argos owner in time for Tuesday’s “put up or shut up” deadline.

Talks between the supermarket and Home Retail have stalled, according to a report in the Financial Times, although one of the sources cited said the pair were still in contact and could yet come to an agreement by Tuesday.

Sainsbury’s is thought to be unwilling to pay more than 150p a share, while Home Retail is said to be holding out for 170p, valuing it at close to £1.4bn.

If a deal falls apart, it will be good news for Crispin Odey. He has rebuilt his hedge fund’s short position in Home Retail, which has just offloaded DIY chain Homebase to Australia’s Wesfarmers for £340m.

More than 2.1 per cent of the shares are back on loan to Odey Asset Management, suggesting the hedge fund guru thinks a takeover will not happen.

Sainsbury’s shares surged by 8.4p to 245.1p, pleasing investors who are against the deal, while Home Retail dropped 5.8p to 136.7p.

The FTSE 100 finished a turbulent month on a high as it leapt 152.01 points, or 2.6 per cent, to 6,083.79, finishing above 6,000 for the first time since early January.

Imperial Tobacco puffed 132p higher to an all-time high of 3,786p. If a bidder emerges for the Gauloises owner, as speculation suggests, it would probably have to pay well in excess of £40bn.

Investors were unfazed by a 51 per cent slump in third-quarter underlying earnings to $494m (£348m) at Vedanta Resources, 8.3p richer at 244.1p, as the commodities crunch gripped the Indian miner.

Jimmy Choo’s rally continued as the luxury shoe maker put on 9p to 139p following Thursday’s strong annual update.

Polypipe, up 41 per cent last year, fell 1.75p to 313.5p on its FTSE 250 debut, as the plastic piping specialist took Bwin.party’s spot on the mid-cap index after Sportingbet owner GVC’s £1.1bn reverse takeover.

On AIM, the cash-strapped Irish oil firm Petroceltic jumped 6.75p to 23p in anticipation of a takeover bid from activist investor Worldview.