News of a move by the world's seven most powerful economic nations to underpin global financial systems injected another confidence boost into stock markets yesterday, with London taking part in that advance.

Posting its fourth gain of the week, the FTSE 100, the London market's premier index, burst through the 5,400 level, to finish with a 79.9 rise at 5,438.4.

That gain extended the rise on the week to 221.3, or 4.2 per cent. Sentiment in London has been on a rising curve since the front-line index hit its year's closing low, 4,648.7 on October 5th in the wake of the effects of Long Term Capital Management's near-collapse, the big slide in Asian markets and Russia's economic woes.

Some market sceptics still take the view that the rally, which has seen Footsie pick up just short of 17 per cent from its year low is no more than a "suckers' rally".

The Footsie's surge was matched point for point by the FTSE 250, which finished at the day's best, up 78.5 at 4,811.4 - its best level since September 10th - a rise stimulated by outstanding performances from many of the information technology stocks and investment management groups, two areas that have suffered very badly since the financial crises first blew up. That gain was the 12th in 13 sessions for the midcap index, which posted a week's rise of 159.2 or 3.4 per cent.

The fund management sector was also boosted by reassuring numbers earlier in the week from Amvescap.

Even more impressive was the latest show of strength from the smallcap stocks, which provided sufficient ammunition to propel the FTSE SmallCap index back through the 2,000 level. It finished 31.4 or 1.6 per cent higher at 2,012.3, up 67.24 or 3.5 per cent on the week and extending its winning run to a record 14th straight session.

Bulls pointed to Wall Street's outstanding performances overnight and again early yesterday as evidence of the return of confidence to global stock markets and also pointed to the probability of more reductions in global interest rates in the short term.