A resurgence of support for the TMT sectors - techs, media stocks and telecoms - plus a strong showing by the oil stocks - were behind a buoyant London Stock Market yesterday.
Big gains in all the main indices were even more impressive following the decision by the Bank of England's monetary policy committee to leave interest rates on hold.
Market-makers said fund managers had been chasing the TMT stocks in order not to be left behind by any rapid recovery in the US economy, and ahead of next week's US Federal Reserve rate setting meeting.
Adopting a cautious view of the market's rally, Mr Tony Jackson, UK equity market strategist at ING Barings Charterhouse Securities, said: "Its an impressive performance. The FTSE 100 is close to its two-week high and only 1,000 points off its high back in January. Let's see if it can hold it."
The background to London's big gain was another powerful performance by Wall Street. The Dow Jones Industrial Average drove back through the psychologically important 10,000 level, for the first time since early September, surging over 170 points in the process, as London trading drew to a close.
Just as impressive was the latest stunning showing by the Nasdaq Composite, which raced back through the 2,000 mark for the first time since August 7th, and was up around 70 points during London trading.
Ironically, the Dow's re-crossing of the 10,000 mark occurred six years to the day after US Federal Reserve chairman Mr Alan Greenspan made his famous "irrational exuberance" speech to the American Enterprise Institute. Wall Street's momentum developed on Tuesday evening after two of the leading US tech stocks, Cisco and Oracle, announced positive news.
That was enough to drive European markets ahead early in the day. Sentiment was enhanced during the afternoon, with news that the US Purchasing Manager's index for service industries had risen to a much higher-than-expected 51.3, from October's 40.6. The NAPM news stunned the market and was seen as possibly heralding a recovery in the US economy.
Turnover in equities continued to improve, reaching 3.13 billion shares at the 6 p.m. cut-off.
