The best form of defence is not attack, as the proverb has it, but success. And as the London Stock Exchange waits to see whether the Competition Commission will permit it to be taken over, it is only natural for it to present itself as a strongly dynamic business.

For this may help push up the price a bidder has to pay for it, and could conceivably push the price so far that potential bidders withdraw - an outcome that would not displease those within the Exchange who would prefer it to retain its independence.

Happily for the Exchange, statistics are helping it make its case. Yesterday's figures for June showed that this was the strongest month for initial public offerings on the main market since 2001, with 15 raising £1.9bn, while 36 IPOs on Aim raised a further £552m. Trading was also good - the average daily number of trades was up 31 per cent on June 2004, while the increase over the first six months of the year was approaching 20 per cent.

All this compares very well with Euronext, the likeliest bidder for the LSE, whose IPO record is dwarfed by London's. Euronext, despite a strong June, has seen sluggish trading growth this year.

London, in short, remains a great prize: by far Europe's biggest and most dynamic cash equities market, thanks to the UK's economic buoyancy; the City's expertise, deep pools of liquidity and respected regulatory framework; and the streamlining of the LSE's operations by Clara Furse, the chief executive.

But Deutsche Borse's apparent sidelining from a takeover bid does not necessarily leave rival Euronext with a clear run. First, the Competition Commission, which has delayed its interim report on the LSE until the end of the month, could impose important conditions, such as limits on prices charged to users or give them a bigger say in Exchange policy, including price-setting.

Second, a continued strong trading performance by the LSE could help its share price. At present this is buoyed by bid speculation and trades on a prospective price/earnings ratio of 20, compared with a sector average closer to 16. If the good numbers persist - and the first quarter is not necessarily a guide to the full year - analysts may re-rate its shares on more fundamental grounds.

Euronext has already created expectations by saying it could get synergies worth 300p per share from a takeover, which it would have to share with LSE shareholders. However, any constraints imposed by the Competition Commission could significantly reduce that figure.

In short, there is plenty of scope for a sizeable gap to emerge between the bid price the LSE board would accept, and what Euronext's shareholders (some of whom saw off Deutsche Börse's putative offer of 530p) would allow it to offer.

So as the LSE prepares for its annual meeting tomorrow, it needs to reassure investors that it has a strong independent future if all the bid activity comes to nothing.

Yesterday's trading figures are a good start.

But there are limits to organic growth and the Exchange's big strategic weakness remains its lack of a heavyweight derivatives trading arm.

It needs to tackle this, possibly by moving from defence to attack and taking over a sizeable, existing derivatives business. I would not be surprised if it were drawing up a list of possible targets.

There is a danger of a touch of unwarranted self-congratulation setting in over the City's response to last week's terrorist bombs in London.

One should obviously have great sympathy for the victims and families, and praise for the emergency services that had to handle the nightmare.

But there has also developed a less warranted train of comment, to the effect that the City of London could take what the bombers threw at it, thanks to the efficient operation of emergency contingency plans and the defiant attitude of City workers.

It is certainly reassuring that the disaster recovery plan operated by LCH Clearnet, whose building at Aldgate was evacuated, went smoothly.

But apart from that, and the closure of the London Metal Exchange's trading floor, because the building was in a police exclusion zone, the fabric of the City was not affected by the bombs, which were underground or in the West End.

In short, this was not the kind of direct assault on the financial district that New York faced with 9/11, and that London could yet face. We simply do not know what "they" are capable of throwing at us, and how well we might respond. Let us hope we do not have to find out.

Stephen Byers, who as transport secretary oversaw the government's disgraceful bouncing of Railtrack into administration in 2001, is finally due to appear in court today to give evidence in the case of "misfeasance in public office" brought by small shareholders. It should be a day of great entertainment, and much satisfaction for the investors, whose chances of bringing the case to court were ridiculed by some.