Supermarkets closed higher on the Footsie after Morrisons posted an unexpected rise in sales following its best Christmas for four years.
The Bradford-based grocer saw shares surge more than 8% after reporting a 0.2% rise in like-for-like sales, excluding fuel, in the nine weeks to January 3.
There was a mini recovery on the wider FTSE 100 Index as it lifted 57.4 points to 5929.2 after falling to its lowest level for more than three years on Monday, reflecting positive overnight trading in China.
Global markets have tumbled over the last week after a run of poor economic data and interruptions to trading on Chinese markets.
Last week, top flight shares in London saw £85bn wiped off their value after falling 5.2%.
However, indices across Europe yesterday clawed back some of the recent ground they have lost, with the Dax in Germany and Cac 40 in France both closing around 2% higher.
In New York, the Dow Jones Industrial Average was flat in early trading.
The pound fell to a five-and-a-half-year low against the US dollar after the Office for National Statistics said manufacturing production dropped by 0.4% in November.
Sterling weakened by two cents to just under 1.44 dollars — its lowest level since June 2010. The pound was a cent lower against the euro at just under 1.33.
The biggest risers in the FTSE 100 Index were Tesco, up 9.8p at 155.2p; Shire, up 189p at 4114p; Berkeley Group, up 134p at 3672p; and GKN, up 9.6p at 288.3p.
The biggest fallers in the FTSE 100 Index were Randgold Resources, down 163p at 4188p; Antofagasta, down 13.6p at 374.1p; BHP Billiton, down 18.2p at 617.9p; and Rio Tinto, down 45p at 1652p.
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