FTSE slightly higher in midday trade

2/08/2010 04:08:00 PM

LONDON – Shares in London on Monday staged a fragile rebound after sharp falls last week caused by mounting debt fears in Europe, with the FTSE up 0.11 percent at 5,066.37 points in late morning trade.

At the open, the index of leading shares had posted a robust gain of almost one percent but failed to keep up the momentum.

Last week the FTSE slumped by almost 2.5 percent on growing concerns that debt-ridden countries Greece, Spain and Portugal may be unable to stabilise their public finances, having spent heavily to combat recession.

"The economic woes in Europe are dominating headlines," ODL Securities analyst Owen Ireland said on Monday, adding that there were two schools of thought regarding the issue.

"The pessimistic view is that by bailing out Greece, we risk going back to the 'too big to fail' , thus setting us back on the road to doom.

"The optimists point to how the issues in Dubai were quickly smoothed over and how it was only a blip in the recent long term recovery.