London market rallies to finish on a high

The highest inflation rate since 1992 and a strong sell-off in Asia failed to spook investors in London as early falls in the markets soon recovered.

Strong trading updates from a handful of FTSE 100 businesses also helped ease the mood as it closed the day up 26.11 points (0.35%) at 7,589.66.

Chris Beauchamp, chief market analyst at online trading platform IG, said investors are starting to become accustomed to the frequent talk of higher US interest rates.

He added: “An improving economy will still provide the chance for earnings to grow, and the current reporting season should help remind investors of that fact.”

Germany and France also put in decent performances, with the DAX up 0.14% and the CAC up 0.38%.

As markets closed in Europe the pound was flat against the euro and dollar at 1.20 and 1.363 respectively.

In company news, Pearson put in a strong performance, with bosses revealing annual sales rose 8% along with an increase of a third in adjusted operating profits.

Shares closed up 27.6p at 660p.

Pub chain Wetherspoons revealed a 16.6% fall in sales over the 12 weeks to midjanuary as the impact of the Omicron variant took hold. Shares closed up 16p at 919.5p.

The biggest risers were Polymetal up 86p at 1,218.5p; Burberry up 111p at 1,866.5p; Fresnillo up 39.2p at 839.2p; Unilever up 159p at 3675.5p and Pearson up 27.6p at 660p.

The biggest fallers were Ashtead down 238p at 5,216p; IAG down 5.64p at 160p; DCC down 176p at 6,306p; Sainsbury’s down 7.4p at 291.3p and Melrose down 3.45p at 162.8p.