Expectations of a record-breaking rights issue, or some form of fundraising, from BT and the prospect of another cut in UK interest rates had dealers in London's equity market bracing themselves for plenty of action today.

But while the market was readying itself for action stations, it meant that activity yesterday fell away as investors preferred to keep their powder dry until the official announcements on those events were made.

And with the institutions mostly reluctant to deal, the market struggled all day. They were weighed down by a variety of bearish news items.

Already burdened by the BT rights worries, the last thing that the bruised TMT sectors needed yesterday was a veiled profits warning from Spirent, one of the FTSE 100's telecoms equipment manufacturers.

Although the Spirent news did not come completely out of the blue - rumours of bad news were circulating in the market for much of last week - the market registered its disappointment, with Spirent shares sliding over 16 per cent, by far the worst performer in the 100 index.

While there remained some lingering doubts in the market over the structure of any BT rights issue, the UK interest rate cut was being taken for granted. "It is almost unthinkable that the MPC will leave rates unchanged," said one dealer who added that a 50 basis points cut could be on the cards.

Leading the late charge by the market were oil majors BP Amoco and Shell, both surging higher in the wake of US support after the hefty losses sustained on Tuesday.

The telecoms giants also played a big part in the FTSE 100's revival, with BT recouping a substantial decline to finish comfortably higher on balance.

The FTSE 250 ended the day a net 15.1 off at 6,480.3 while the SmallCap was finally 8.3 easier at 3,080.7 affected by some hefty losses in a number of the small tech stocks.

Turnover in equities was 1.7 billion shares.