THE surprise quarter point cut in British rates, the subsequent surge on the British stock market, stronger bond markets and a firmer opening on Wall Street all combined to provide the impetus to push the Irish market to a new high.

There was strong demand for the financials, which accounted for most of the rise in the index.

IAIB and Irish Life were in the most demand with AIB closing up 3p on 368p while Irish Life rose to a new high of 260p before eventually closing up 3p on the day on 257p. The other financials were less active and Bank of Ireland edged 1/2p higher to 465 1/2p, Irish Permanent was unchanged on 405p while Woodchester was 1p firmer on 176p.

Industrials were dull and Smurfit drifted 1p lower to 161p with negative comment still circulating about the prospects for the sector. CRH closed on 465p while Fyffes moved 2p higher to 109p. Among second liners, Adare gained 5p to 405p, Heiton was unchanged on 79p after interim results in line with forecasts while Unidare gained 5p to 295p.

Gilts had an excellent day and benefited from a series of interest rate cuts in Europe and an expectation that German and Irish rates will move lower in the short term. Five year gilts closed 30p higher on a yield of 6.30 percent, 10 year gilts were up 40p on a yield of 7.10 per cent while the long gilt closed on a yield of 7.35 per cent.

The timing of the cut in British rates came as something of a surprise but the size of the cut was expected, with signals that British inflation is receding. Attention today will be on the US payroll figures although activity may scale down ahead of Tuesday's budget.

Trading in futures continued at a high pitch with 420 March medium gilt futures trading as well as a further 175 DIBOR futures. The underlying value of the contracts traded on IFOX yesterday was £108.5 million.