It was always going to be a struggle for London's equity market at the start of a week that promises plenty of action in global stocks.
But London picked itself up from a rather wobbly opening to finish the session in reasonably good heart and 22.7 higher at 6,317.0. At its worst, in mid-morning, the 100 index was down 24.9 at 6,269.4. At its best, in mid-afternoon, it was up 40.8 at 6,335.1.
The other indices performed more solidly, the FTSE 250 closing up 9.1 at 6,725.2 and the SmallCap 6.4 firmer at 3,320.0. The Techmark 100, meanwhile, settled up 2.67 at 2,782.93.
Dealers were bracing themselves for the January meeting of the US Federal Reserve's open market committee. It starts its two-day deliberations today in Washington.
The general view in the markets is that the FOMC will sanction a further 50 basis points cut in the Fed funds rate and a similar cut in the discount rate, matching the reductions made at the start of the month.
But dealers said there was a distinct possibility it would go for a smaller, 25 basis points cut and there were some suggestions the Fed might prefer to wait for more evidence of the pace of the US slowdown before cutting again.
One market-maker warned markets would not take kindly to much less than 50 basis points: "There is a lot of room for disappointment," he said. "If Wall Street tumbles, so do we."
With UK economic data thin on the ground this week, the market was looking ahead to next week's UK interest rate decision to be announced on Thursday week, after the February meeting of the Bank of England's monetary policy committee.
That is expected by many economists to bring the first change in UK rates after 11 consecutive MPC meetings. The lower than expected increase in the preliminary estimate of UK gross domestic product for the fourth quarter announced last week was being interpreted as increasing the pressure for a cut in UK rates.
And the recently announced minutes of the January meeting of the MPC showed the vote to leave rates on hold was the closest possible margin, 5-4.
In its latest UK strategy document, the strategy team at Schroder Salomon Smith Barney said: "We expect an improving economic outlook to drive a re-rating of UK equities over the next 12 months."
The analyst warned, however: "It is likely to be a tough February/ March reporting season. Profits downgrades are the price that must be paid for a more benign interest rate environment."
