MARKET REPORT - LONDON

LONDON stocks ended a brief hiatus to continue their record breaking run yesterday.

The FTSE 100 index notched up new intraday and closing peaks in spite of pressure late in the afternoon from Wall Street.

Footsie was indicated higher first thing in the morning and pushed further by a strong early performance from the futures contract, which opened above its estimated fair value premium to the cash market.

Sogginess springing from the huge disposal of BP shares on Wednesday and Thursday by the Kuwait Investment Office appeared to have been absorbed. And the market braced itself for the midmorning expiry of index options.

Because of a severe short position in that area of the options market, prices were squeezed sharply higher and the Footsie was up 42.5 during the 20 minute expiry period.

At 4,723.7 it surpassed Tuesday's previous peak by just three points.

However, there was a bare minimum of British economic and corporate news around and Footsie, which stays open later than many of its European rivals, was bound to be susceptible to any correction on Wall Street.

In late British trading, Hewlett Packard, the computer group, fell 10 per cent after Thursday's posted below expected second quarter earnings prompted brokers to cut forecasts.