A turbulent week in London's equity market ended with the FTSE 100 recouping much of the ground lost in midweek and all the other indices in positive territory as the prospect of interest rate cuts on both sides of the Atlantic proved a compelling draw to investors.
At the end of another day of erratic moves in the market, the FTSE 100 was up 104.5, or 1.8 per cent, at 5,870.3. That rally left the index 81.1, or 1.4 per cent, lower over the week.
Although left behind by the 100 index yesterday, the FTSE 250 and SmallCap indices performed impressively over the week compared with Footsie. The Techmark 100 edged up 8.9 to 2,051.16 but was still 29.16, or 1.4 per cent, down on the week.
Although markets trembled at the start of the session and again in the early afternoon amid ever-present worries about the extent of the economic slowdown in the US and elsewhere, those fears ironically led to a fresh burst of buying exuberance on the premise that such weakness will induce further US rate cuts.
The day's big economic news came from the US where news of a higher-than-expected decline in the April non-farm payroll, a drop of 223,000 jobs compared with a forecast of 30,000, caused a flurry of interest.
Before the US report, the FTSE 100 had gathered itself after a rather tentative opening. It was up 81 when the news flashed on the trading screens. Within a minute, that rise was pared to 31 with the index sliding further as Wall Street opened.
Super-stocks such as the oils and banks, which had dragged the market down on Thursday, moved ahead strongly for the same reason. The banks were helped by the official merger agreement announced by Bank of Scotland and Halifax.
The UK Strategy Team at Deutsche Bank warned: "Although cash levels have picked up over the past year, liquidity in not especially high in a historical context. The increase in paper from the telecoms sector has started and there are likely to be more placings and rights issues to mop up liquidity over the next few months."
Turnover was 1.99 billion shares.
