Relief over rates halts sequence of losses

The three-session sequence of losses sustained by the London market's benchmark index, the FTSE 100, was halted yesterday amid relief that the Bank of England's monetary policy committee had decided to leave domestic interest rates on hold for the time being.

Also helping to revive the market's confidence was a strong showing by many of the super-heavyweights, most notably the oil majors, but also some of the telecoms and bank stocks.

Adding to the overall good feeling was a strong opening by Wall Street, where the Dow Jones Industrial Average surged, climbing 130 points only to slip back later in the session.

Sentiment in London was also lifted by hopes that more takeover stories could come to fruition in the near term, especially those involving FTSE 100 stocks.

But the enthusiasm surrounding the leaders was tempered by some of the worst daily performances ever for water stocks.