There was some welcome relief yesterday for London's stock market, which has been under constant fire so far this year.

A strong rally, triggered by some determined buying of the consumer cyclical sector, plus the emergence of the first potentially big takeover deal of the year, drove all the main FTSE indices higher.

But there remained unremitting downside pressure on many of the technology and Internet stocks that are now paying the price for their stunning market performance in the last two months of 1999. The technology sell-off was prompted by Thursday's sharp decline in the Nasdaq, which dropped 150 points, or almost 4 per cent overnight, in spite of a strong showing by the Dow Jones Industrial Average.

And dealers were under no illusions about the potential for interest rate rises in the UK, US and the euro zone. Most economists expect the Bank of England's monetary policy committee to move UK rates up after its two-day meeting, which starts on Wednesday.

The FTSE 100, which had dropped almost 7 per cent in the first three sessions of the year, made rapid progress at the outset, before stuttering in mid-session and building again to end 57.6 higher at 6,504.8. Over the shortened week, the index fell 425.4, or 6.1 per cent.