The better feel to the UK stock market continued yesterday with the FTSE 100, restrained over the previous two sessions by the weakness of oil shares, at last rejoining the party.
The latter sector rallied strongly, lifted by a similar move by crude oil prices, although sentiment in that area remained extremely strained after the failure of OPEC to persuade non-OPEC producers to join them in cutting output in order to stabilise oil prices.
The market has staged a remarkable rally from last Monday's big sell-off, triggered by the US airliner crash in New York which saw global stock markets plummet amid fears that the crash was caused by terrorist activity.
But the subsequent view that the disaster was unlikely to have been deliberately caused, plus the rapid pace of success by anti-Taliban forces in Afghanistan, saw markets quickly regain their lost confidence.
Investors focused on other news too. Lower oil prices are seen as hastening the pace of economic recovery, especially in the US. And the October inflation data and the Bank of England's Quarterly Inflation Report provided no problems for the stock market, either.
On the contrary, the inflation report was interpreted by economists as sending a strong message that the current rate-cutting cycle is by not finished yet.
At the close of another session featured by well above average turnover, the FTSE 100 index settled a net 52.8 higher at 5,291.0, its best closing level since September 5th, having risen to a session high of 5,313.8.
Crucially, chartists said, the index finished above the 5,286 level which has been a serious barrier in recent weeks.
And the more junior rounded off a splendid week with further strong performances, the FTSE 250 adding 14.4 more at 5,923.8, its highest since September 6th, and the FTSE SmallCap 17.1 at 2,592.4, its best since September 7th.
The Techmark 100's impressive rally from its September 21st record closing low of 1,064.98 was taken a stage further, the index racing up another 9.51 to 1,617.79, its best level since August 2nd.
Turnover reached 3.1 billion shares.
