Excellent performances from most of heavyweight stocks, such as the oil majors, pharmaceuticals and some of the big banks, extended the FTSE 100's rally to a fourth straight session yesterday.
But while the latest rise in the 100 index instilled renewed confidence in institutional and private investors, there was bad news elsewhere. Further evidence of the underlying problems affecting many of the mid and smallcaps came in the shape of another flurry of profit warnings and poor results.
And it was not only the second- and third-tier areas of the market that suffered serious setbacks. Dealers said the FTSE 100 would have been well on the way to posting another three-figure gain had it not been for another disastrous performance from BT, whose market capitalisation yesterday fell below £30 billion, having been above £115 billion at its peak around the turn of the millennium.
London's performance yesterday was almost a mirror image of those earlier in the week, with an uncertain opening giving way to a mid-morning rally, bouts of uncertainty ahead of the opening of Wall Street and a fresh run towards the close.
Just as impressive was London's ability to shrug off further weakness on Wall Street, where the Dow Jones Industrial Average followed up Wednesday's 92 points slide with a near three-figure decline yesterday.
Evidence of weakening consumer confidence came as no surprise to the stock market, nor did the European Central Bank's decision to leave interest rates on hold.
At the close of another session of relatively high turnover, the FTSE 100 settled 67.5 higher at 4,763.6, the session high, having hit a day's low of 4,651.0. Over the week so far the index has risen 329.9 points, or 7.4 per cent.
The FTSE 250 dropped 25.6 to 5,029.0, having threatened at one stage to drop back below 5,000. The FTSE SmallCap, meanwhile eased 1.9 to 2,150.7.
The retreat by many of the TMTs saw the Techmark 100 lose 24.91 to 1,143.89.
Turnover in equities was 2.6 billion shares, with the number of trades reaching 121,666.
