Footsie was riding high yesterday but, for the second time in a week, London's equity market was largely a one-horse town.

Almost half of the gains in the leading index represented a remarkable rise by Glaxo Wellcome, Britain's biggest company by market capitalisation.

Its contribution to the overall market performance was akin to Monday's big rise in BT, although that gain - on the back of the weekend's AT & T deal - was unable to keep the market up at the close of trading.

By yesterday's close, the FTSE-100 index was up 66.6 at 5,910.7, while the FTSE Mid-250 index rebounded 36.9 to 5,485.4 and the SmallCap improved 7.0 to 2,467.3.

The sharp rises, although backed by solid buying, have highlighted the volatility of Footsie stocks since order-driven trading (Sets) was introduced last October.

Prices have swung around in spite of attempts by the stock exchange to address the problem with shorter trading hours.

One pharmaceuticals analyst said of Glaxo's performance: "There has been a fair amount of genuine buying, but under the old system you would not have seen rises of this magnitude."

Footsie's other big winner of the day, Sun Life, was a more classic example of Sets-related trading. The shares shot up 14 per cent on very little volume.

Underpinning individual gains was a growing feeling that the Bank of England is unlikely to increase interest rates next week.

Barclays Capital says in its latest strategic overview: "Data released since the last meeting suggest rates won't rise in August. All of the key activity numbers released since the MPC last met point to an across-the-board slowdown in growth."

And Goldman Sachs, which has a broadly cautious view on the British economy and a three-month Footsie target of 6,030, says: "The MPC is unlikely to increase base rates next week and the next move in market sentiment could be towards lower rates."

However, Mr Bob Semple at BT Alex Brown points out that the monetary policy meeting will coincide with the next inflation report, which could be higher than expected because of the government's recent decisions on minimum wages and increased spending. An additional pointer towards a restrained interest rate scenario was seen in the currency markets. Sterling retraced further against the deutschmark providing another fillip to hard pressed manufacturers, particularly in the engineering sector. The pound dipped briefly below DM2.90 at one point.

There was also support from the Dow Jones Industrial Average, which shrugged off some slightly inflationary employment data to trade 80 points higher by London's close.

Glaxo, interest rates and the US were easily a match for the day's downside pressure - a surprise announcement that the government was launching an anti-trust inquiry into the buying power of the big supermarket chains.

The banking sector also helped the FTSE-100 Index recover its composure after Halifax and Prudential announced a lift in profits.

Halifax, which reported an increase in half-year pre-tax profits from £802 million to £843 million, dropped 36 1/2p to 730 1/2p.

The Prudential Corporation, up 16p to 838p, shrugged off the effects of the pensions mis-selling scandal as it reported increased profits.

The Prudential reported half-year operating profits of £474 million, up from £442 million last time.

The announcements helped the rest of the banking sector move ahead after Lloyds TSB improved 14p to 901p, Abbey National gained 28p to £11.55, Barclays shifted 19p higher to £17.65 and the Woolwich headed 9 3/4p north to 336 1/4p.

By the close, overall turnover had reached a respectable 814.1 million shares with activity weighted towards non-Footsie stocks.