Dominated by economic news out of the US and London on Thursday, the FTSE 100 soared during the day, but gave back many of its gains before the session was finished.
Having traded as high as 7,619.39 earlier in the day, after markets opened on Wall Street, the FTSE fell back, ending more than 100 points lower.
By the end of the day, the index had gained just 9.82 points, or 0.1%, ending at 7,503.27.
The early-morning rally was sparked by the US Federal Reserve’s decision to push up interest rates by 50 basis points, the biggest hike in more than two decades.
“European markets were on the cusp of some decent gains today, largely because of yesterday’s post Fed rebound in US markets,” said CMC Markets analyst Michael Hewson.
“However, the weak start to trading in the US is now starting to act as a drag as we head into the close, pulling the likes of the Dax and Cac 40 off their highest levels of the day.”
Dax, the main German index, ended up dropping 0.5% while the Paris-based Cac fell 0.4%.
The FTSE’s rise earlier in the day had been helped by a falling pound. Sterling had dropped more than 1% against the dollar. But it recovered most of that lost ground and was down just 0.12% shortly after markets closed in Europe, hitting 1.2361.
Against the euro, the pound rose 0.06% to 1.1755.
US markets were a bloodbath. By the close of play in London, the S&P 500 was trading down 3.5% while the Dow Jones had lost 2.9%.
In company news, despite headlines focusing on calls for a windfall tax to hit oil giants like Shell, investors were much more focused on its juicy profits.
The business said its first-quarter profits reached a record high thanks to the soaring price of oil and gas.
At 9.1 billion US dollars (£7.2 billion), underlying earnings were higher than expected and close to three times better than the same period a year ago.
Shares in the company joined those doing best on the FTSE 100, closing up 3.1% by the end of the day.
Investors were less keen on the retailer Next, which reported a drop in online shopping as pandemic restrictions eased.
Sales grew though, by over 21% in the 13 weeks to the end of April, as customers headed back to the company’s shops up and down the country.
Compared to pre-Covid levels, sales are still 8% below where they had been, the business revealed.
Shares dipped 0.7%.
The biggest risers on the FTSE 100 were Aveva Group, up 107p to 2,294p, Mondi, up 64.5p to 1,566.5p, Endeavour Mining, up 81p to 2,022p, Shell, up 68p to 2,293p, and Avast, up 14.8p to 336.6p.
The biggest fallers on the FTSE 100 were Hikma, down 167p to 1,685.5p, Ocado, down 62p to 830p, Admiral Group, down 172p to 2,321p, ITV, down 4p to 71.14p, and Antofagasta, down 73p to 1,446.5p.