London markets snap back from bruising day

London markets snapped back from a bruising day yesterday as investors were buoyed by a rally on Wall Street.

The capital’s premier FTSE 100 index added 0.81 per cent to reach 7,357.14 points, while the domestically-focused FTSE 250 index, which is more aligned to the health of the UK economy, shot up 1.25 per cent to 21,719.76 points. The City’s top indexes closed sharply lower yesterday after investors were spooked by fears over the US Federal Reserve telling markets to get ready for a rapid tightening in monetary policy this year at its meeting tomorrow. But, they partially reversed those losses this morning.