Quantitative easing boosts FTSE

FTSE 100 Index up 13 points to 5248.2 by mid-morning

London's blue chip share index staged a sharp recovery after a smaller-than-expected £25 billion money boost from the Bank of England.

The FTSE 100 Index bounced back from a 70 point plunge at one stage to close up 17.8 points at 5125.6.

An impressive start to trading on the Dow Jones Industrial Average on Wall Street - up 1.5% in the first few hours - helped give London's Footsie a boost.

US stocks jumped after encouraging news on jobs and consumer spending, with a fall in the number of newly laid-off workers seeking unemployment benefits and retailers posting their second straight month of sales gains in October.

In the retail sector, Tesco surged 9.7p to 418.7p and Marks & Spencer rose another 2.6p to 364.1p as it continued to benefit from yesterday's better-than-expected results.

Mobile phone giant Vodafone was also making gains, adding 1.45p to 137.45p, while BT - due to announce interim results next week - climbed 3.3p to 136.9p.

More defensive stocks were in vogue earlier in the session as investors looked to protect themselves from market volatility and British American Tobacco and Imperial Tobacco held firm in positive territory, closing up 34p at 1951p and 23p to 1814p respectively.

Telecoms firm Cable & Wireless led the fallers board, down 6% or 9.1p to 138.9p after plans to demerge its UK business were overshadowed by the firm downgrading earnings guidance for its Caribbean arm this year.

Alongside Cable & Wireless, British Airways and Royal Bank of Scotland were on the back foot ahead of results tomorrow.

Struggling BA shed 5.5p to 186.3p as markets braced themselves for a hefty first-half loss, while RBS was 1.26p lighter at 35.21p a day before the part-nationalised bank reclaims the spotlight with third quarter figures.