Footsie hauls itself out of doldrums

London's FTSE 100 Index hauled itself out of the doldrums to produce the market's biggest rise in percentage terms since October 1987.

On another day of volatility, the Footsie surged 199.9 points to 3486.9 after putting back all yesterday's losses - and adding 30 points on top of that.

The rise of 6% was driven by a resilient close to trading in New York last night and an encouraging start to business on Wall Street this afternoon.

Analysts said buyers in London had been lured back by cheap looking stocks although most experts were taken aback by the scale of the recovery.

Tom Hougaard of financial bookmakers City Index said: "This was the most encouraging close I could have imagined. I was looking for a final capitulation day today."

Investors had feared more losses after uncertainty over Iraq drove the FTSE 100 Index to its lowest point since June 1995 last night.

But there were reports the heavy losses had been caused by one institution dumping shares after seeing the Footsie fall below a certain point.

Peter Cogliatti, of brokers Williams de Broe, said it was clear that the sell-off had been overdone.

"There was nothing yesterday to warrant such a fall. It looks like it was just down to selling into an unreceptive market."

However, he said the future direction of the market still remained unclear.

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