Investors shrugged off fresh economic gloom today as the FTSE 100 Index built on yesterday’s 6% surge with further gains.

Interest rate cut hopes and a smaller-than-expected contraction in the US economy helped the London market consolidate recent gains today.

The FTSE 100 Index jumped 8% today as hopes for another round of interest rate cuts led to the third biggest gain in the benchmark’s history.

Hopes that the US Government’s $700bn bank bail-out may not be dead in the water helped the London market bounce back nearly 2% today.