Resurgent Footsie defies anti-capitalist carnival

Perhaps it was a deliberate attempt to fly in the face of central London's anti-capitalism rally, but the Footsie took off yesterday.

As a protest march filled the streets with a carnival atmosphere, the UK index streaked almost 100 points higher in early trading.

The blue-chip index appeared to shrug off concerns about a possible hike in US interest rates at the end of the month and concentrated instead on reaching a new high. It had its first crack mid-morning while the futures contract on the Footsie went through its expiry.

Markets are always volatile during the relevant period and heavy position-taking pushed the underlying index up to 6,593.1. At that level, the FTSE 100 was just five points below its closing high.

Much of the optimism sprang from the general view that, while a quarter-point rise in US rates is probable, it is unlikely to be followed by further increases. Strategists had previously thought that with Asian problems receding, Alan Greenspan and the US Federal Reserve would rapidly unwind the three-quarters of a point decrease that took place late last year.

Footsie had a second run upwards in the afternoon, but the Dow Jones Industrial Average began to slip back towards the close and Footsie ended 34.2 higher at 6,527.8.