By Rob Arkwright, Hargreave Hale & Co AS expected this week, the US Federal Reserve left US interest rates unchanged at 6.5pc.

This was as a result of the economy showing enough signs of slowing down and the growth of demand for goods returning to more manageable levels. It caused increased activity on the market, pushing the FTSE 100 to an 11-week high.

Even before the decision was announced, the banking sector saw an excellent rally, as institutions predicted would be the case. Lloyds TSB saw the best of the gain. Abbey National and Bank of Scotland also saw good rises.

Long suffering retailer, Boots, has come to life this week following rumours that Wal-Mart of the US may be considering a £6 billion bid. The shares received a good boost.

Among the food retailers, Sainsbury, which was hit by a sharp fall in profits earlier this year, has said that it is considering a £1 billion sale of its DIY arm, Homebase.

It is thought that a European or US retailer is a likely candidate in order to enter into the UK DIY market. Its shares saw a decent rise as a result.

Oil stocks were strong again this week with crude prices continuing to rise. BP and Shell have risen again, but some of the smaller oil exploration companies are also reaping rewards. The likes of Premier Oil, Dana Petroleum and Bula Resources all rose this week.

Shares in the telecoms sector are continuing to struggle, due to mounting fears over the increasing debt being incurred, as a result of bidding for third generation licences.

British Telecom, which is currently at a 20-month low, has been further hit, by seeing its credit rating fall from an AA plus, the second highest grade, to a single A. This could have been worse, however, as the company is facing a £30 billion debt burden next year and is under increasing pressure to undergo some radical restructuring.

Finally, on the technology front, Sage, ARM Holdings and Misys have all seen good rises this week on the back of various broker upgrades.