WALL Street's surge through the 7,000 mark on the Dow Jones Industrial Average on Thursday and a £1 billion plus bid provided the perfect background for London's equity market yesterday.
And although the Dow was looking uncertain at the start of US trading yesterday, London held on to most of its gains.
The FTSE 100 closed the day up 13.9 at a new closing record of 4,341.0, and the SmallCap maintained its consistent upward trend, finishing the session 3.8 firmer at a closing peak of 2,338.9. The FTSE Mid250 picked up strongly late in the session, eventually closing 19.3 ahead at 4,606.0. It remained, however, 10 points short of its best ever close of 4,616.0.
Market strategists, although ward of the ever increasing possibility of a short term setback on Wall Street, were relatively sanguine about London.
They pointed out that the British equity market was supported by its underperformance against Wall Street, and also by recent evidence that economic growth had shown signs of slowing.
The trading session began on a curiously subdued note, with London traders unwilling to lift prices too much at the outset, amid fears that Wall Street's latest burst of strength might not be sustainable.
But the agreed bid by Williams Holdings for Chubb Security, and excellent preliminary numbers from Lloyds TSB, the second biggest British bank by market capitalisation, injected confidence.
