THE influence of Wall Street overcame the effect of further disappointing news on inflation to send the FT-SE 100 index to another all time high.

European markets were also supportive, with around 10 continental bourses at all time highs.

Footsie got an immediate lift from the Dow's Wednesday performance and by 9 a.m. was 20 points ahead. However, the inflation numbers gave the market something to chew on as they showed a rise in the headline rate from 2.5 per cent to 2.8 per cent and an unchanged underlying rate (excluding mortgage interest payments) of 3.1 per cent, when most analysts had expected a fall.

Gilt prices were hit by the inflation news and the benchmark 10 year issue was down around five ticks at the close of trading.

But the equity market was not depressed for long and by midmorning Footsie had reached its high for the day of 4,329.9. Further support from Wall Street in the afternoon helped the leading index to close at 4,327.1.

Corporate news was mixed, with a strong set of numbers from oil giant Shell and a bid approach to security group Chubb offsetting £100 million charge against accounting irregularities at Pearson, the media group, and some sterling related caution at the insurance broker Willis Corroon.

Mr Corey Miller, equity strategist at Credit Lyonnais Laing, said: "The undercurrent of the market is very, very strong and it seems able to shrug off the recent profits warnings. But in valuation terms, particularly in relation to index linked gilts, it is looking a bit stretched."

The dividend yield on the FTSE All Share Index was just 3.51 per cent on Wednesday night, while index linked gilts, a virtually risk free asset, were offering a real yield of around 3.4 per cent.

Volume was a healthy 936.8 million shares by the 6 p.m. count, of which 56 per cent was in nonFootsie stocks. The value of customer business on Wednesday, excluding Crest transacted trades, was £747.6 million.