London's equity market extended the strong rally that followed last Friday's dramatic intervention by central banks to end the slide in the euro.
Although there were no signs of further intervention yesterday the euro held up reasonably well, a performance that gave substantial encouragement to European stock markets, with London at the forefront of the advance. And there were other bullish events helping to fuel the advance which encompassed the whole of the London market, especially the recently depressed growth areas, such as the TMTs, the high-tech/media and telecoms sectors.
Wall Street's performance on Friday evening, which saw the Dow Jones Industrial Average rally from an earlier 140-point slide to finish a net 80 points higher, gave London an instant boost at the outset yesterday. So did the performance of the Nasdaq Composite, where an early 200-point decline, provoked mostly by the sequence of profit warnings affecting sentiment in the techs area, was almost eradicated by the end of Friday's US session, when the Nasdaq finished only 25 points off. US markets made further good progress at the outset of trading yesterday, only to lose ground as the session wore on. Shortly after London closed, the Dow was around 10 points off while the Nasdaq was up by more than 20 points.
All the main FTSE indices made rapid progress, with the FTSE 100 extending Friday's recovery at the outset of trading and pushing up to record a three-figure gain at its best of the day, when it hit 6,310.0, up 104.0, over the lunchtime period. It failed to hold those levels, however, dipping off to close a net 51.2 higher at 6,257.2. The most spectacular gain of the indices came from the Techmark 100, where a revitalised TMT area, stimulated by a more aggressively bullish stance adopted by Morgan Stanley Dean Witter, pushed the index 133.0 higher to 3,779.08. At its best the Techmark 100 touched 3,793.67.
Close behind was the FTSE 250, which settled 98.7 up at 6,743.8, after 6,746.2. The FTSE SmallCap gained 24.3 to 3,450.0, its best of the day.
