The mouth-watering prospect of a burst of takeovers in the last quarter when many had expected corporate activity to fade away produced a surge of buying in London's equity market. Footsie closed 141 or 2.4 per cent higher at 6,078.6, having hit 6,087.7, up 150.1, at its best soon after Wall Street opened. The FTSE 250 could only manage a 36.1 gain at 5,699.9 while the FTSE SmallCap continued to struggle, finishing 1.0 off at 2,683.8.

The US market also provided a substantial boost for London, with the Dow Jones Industrial Average racing up more than 100 points early in the US session, allaying some of the recent worries that the Dow is set to drop back below the 10,000 mark. Turnover in equities was 1.1 billion shares.