The FTSE 100 index eventually managed to pull back its losses of the day, sparked by the prospect of further Al-Qaeda terrorist attacks in the US and the UK.
The FTSE 100 index closed up 2.6 points to 4,415.70 today after UK shares regained ground, led by HSBC and Abbey.
HSBC rose 28p to 835.5p after the lender announced first-half profit had exceeded expectations.
Abbey National, the UK's second-largest mortgage lender, advanced 12p, or 2.1%, to 579p after HBOS said it may try to challenge the £8.2bn offer made by the Spanish bank Santander Central Hispano SA.
That said, the impact of terror alerts was fairly hefty on oil prices again, as the September futures oil price hit a record high of $43.92 a barrel earlier in New York and raised the possibility of yet more fuel costs.
British Airways shares fell 6.5p or 2.8% to 224.25p while Irish rival Ryanair saw its share value drop 10 cents or 2.2% to Euro4.40 and Carnival, the cruise operator, fell 44p or 1.6% to £26.48.
Across the Atlantic, the Dow Jones Industrial Average index is currently down 0.15 points to 10,139.56 and the S&P 500 index is also down 1.55 points to 1,100.17.
Nasdaq's Composite index has so far lost 10.75 points to 1,876.61.
US markets appear to be reacting negatively to the threat news and its impact on the oil price.IFAonline
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