Market Report - London

A session of extreme volatility in British shares ended with the FTSE 100 index sitting comfortably above the 5,100 level, having shrugged off a bout of turbulence induced by the US non-farm payroll report for November.

The US data, announced over the lunchtime period, turned European markets upside down. The report, which showed that 404,000 new jobs had been created last month, was seen as an indication that the US economy is growing faster than expected. Many market observers took the view that the news could trigger an increase in US interest rates.

But the London market's response, after its initial shudder, was similar to that of the US, with share prices quickly stabilising and then embarking on another powerful surge.

At the close, the FTSE 100 index was 60.6 ahead at 5,142.9, well short of its session high but equally well clear of the day's low point, 5,047.9.

Over a week which has seen British shares surge ahead in the wake of a sustained recovery in Far Eastern markets and amid a further burst of takeover stories, Footsie has risen a massive 311.1 points, or 6.4 per cent.

The index is now only 224.4 short of its all-time intra-day record of 5,367.3, reached on October 2nd. The market's second-liners and small stocks shared in the market's spree. The FTSE Mid-250 finished 26.8 higher at 4,751.3, up 94.6 on the week, while the SmallCap added 5.1 at 2,296.5.