There was no let-up in the London equity market's march to new records yesterday, with leading shares surging higher for the fourth consecutive session.
Once again, a mixture of overseas and domestic influences provided the impetus, with Wall Street's latest show of power fuelling a rise across all European markets.
On Wednesday, the Dow Jones Industrial Average had climbed another 100 points, passing the 7,900 mark in response to encouraging earnings reports.
And yesterday the Dow made further rapid progress, with comments from Mr Alan Greenspan, chairman of the US Federal Reserve, that the Asian economic crisis would slow the US economy, interpreted as a sign that US interest rates would be left on hold in the short term.
Dealers welcomed the Greenspan remarks. "This is just what global markets were looking for. If the Fed leaves rates unchanged after its meeting next week, and the odds now suggest that that is the case, then Wall Street looks set fair with the obvious implications for London and other European bourses," said one.
And those Asian markets that were open were mostly steady, adding to the bullish sentiment sweeping global markets.
The FTSE 100 index posted its fourth straight gain, finishing 49.8 ahead at a closing record of 5,422.4. At its best, the index hit a new intraday peak of 5,434.1. The latest performance left the index up 241.0 or 4.6 per cent since the beginning of the week.
The FTSE Mid-250 index finished the day 19.2 up at 4,838.3, only 0.7 below its session-best, while the FTSE SmallCap put on 7.5 at 2,368.2.
Dealers said the bullish international news had mingled with positive domestic stories to drive British shares sharply higher, with institutions following their usual pattern of buying into the market by taking out bullish positions in the Footsie future.
On the home front, London was still responding to the recent spate of takeover moves, which provoked big midweek gains across the board in the capital.
And the recent downbeat survey by the Confederation of British Industry, viewed by the stock market as heading off any lingering chances of the British monetary policy committee recommending a rise in interest rates next week, was another bull point. Some market observers took the view that British interest rates had topped out for the current cycle.
Banks, insurances and fund management stocks were among the best performers in the FTSE 100, with a rise in Amvescap reflecting the market's search for the next takeover candidate.
But the stock that caught the eye was Halifax, the former building society, whose shares rocketed 30p to 875p as hopes of a special dividend combined with rumours of imminent takeover moves. Other banks also showed force with Lloyds TSB up 13p to 861 1/2p, while Barclays soared up 15p to £17.78.
W.H. Smith was the biggest name to report results, with half-year p retax profits up from £39 million to a better than expected £45 million.
The figures, together with a progress report on plans to sell the Waterstone's bookshops and Virgin Our Price music stores, lifted shares 9p to 437 1/2p. EMI Group, which has teamed up with Waterstone's founder, Mr Tim Waterstone, to put together an offer for the book shops, slumped 6p to 457 1/2 p.
Elsewhere on the high street, Boots was marked down 8 1/2p to 843p, while W.H. Smith's great rival John Menzies was unchanged at 355p.
Tie Rack fell 33p to 90 1/2p - a drop of over 27 per cent of its total market value - after warning that profits would be hit by the strength of sterling and the warm winter in Europe and the US.
Telecoms group Ionica witnessed another shake-up in the boardroom after chief executive, Mr Nigel Playford, said he was stepping down but would remain as deputy chairman.
Turnover in equities at 6 p.m. was slightly disappointing, reaching 840 million shares.
