LONDON -- Early fears of a market meltdown failed to materialize and with the concerted central bank intervention to lift the euro, Europe made an impressive fight-back to end in positive territory.

The

FTSE 100

fought its way back to close 7 points higher at 6,206. Given that the index was at one time wallowing at a session low of 6,075, that was no mean feat.

Fans of Japanese candle charts will not have been surprised by today's action. The Japanese consider that between eight and 10, but as many as thirteen, higher highs or lower lows signal the elastic limit of a market. The charts showed 11 lower lows on the FTSE 100, but to add further credence to the bullish scenario, today's action has formed what is potentially an extremely bullish hammer formation.

The problem with candle charts is that they frequently give misleading signals. But if this scenario looks correct, expect a rapid rally back towards 6,800.

Hans Guenter Redeker of

Chase

subscribes to the bullish scenario. "There are good signals from the equities markets," he said. "There's a key reversal in the (German) Dax, and maybe the FTSE." Asked whether the hammering the FTSE has taken suggests it is time to get long, he said: "I absolutely agree. It's time to tell people that it's time to do investments." He feels that the market will now rise to 7,300 sooner rather than later.

After slump at the open on the back of

Intel's

(INTC) - Get Report

profit warning, particularly tech and telecom stocks, London by and large sat on its hands. But it still looked like doom, in the shape of higher oil prices, gloom, in the shape of lower equities, and despondency, in the shape of out of line currency markets, would conspire to send the blue chip index back down to the 6,000 level.

However, the surprise central bank action lifted some of the despondency and the FTSE 100 made a tentative comeback.

"The timing of the intervention was interesting", said

Commerzbank

strategist Michael O'Sullivan. "Intel's entire shortfall can be accounted for by the euro." Few expected the central banks to step in today, especially before the weekend's G7 meeting. But step in they did.

The FTSE 100's performance looked all the more impressive given that its five biggest components all finished in the red.

Vodafone

(VOD) - Get Report

suffered as the telecom sector found itself still in the midst of a furious sell-off. The shares closed 3.5p down, or 1.5%, at 236 ($3.45).

British Telecom

(BTY)

has even fewer friends. BT finished 13p lower, or 1.7%, at 735p.

Tech stocks obviously get trashed on the back of Intel. But by the end of the day, although the

Techmark 100

still looked like a sea of red, it did close well above its session low. Ultimately it finished down 51 points, or 1.4%, at 3,646, after having earlier slumped 164 points to 3,533.

ARM

(ARMHY)

finished a mere penny lower at 700p, after having slumped to 605 at one point.

Baltimore

closed on its session high of 687p, up 17p, or 2.5%, after earlier having slumped to 610.

Bookham

(BKHM)

closed 100p lower, or 3.1%, at

31.65. But this is also a marked improvement of where it stood at one point. Early in the session it plunged to a

30.00, its lowest level since the start of June.

BP

(BPA)

and

Shell

(SC) - Get Report

both slipped sharply. BP fell 15p, or 2.4%, to 609, while Shell was down 15.5p, or 2.7%, to 567.5.

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Pharmaceuticals benefited from defensive switching.

AstraZeneca

gained 95p, or 2.8%, to

34.80, while

Glaxo

(GLX)

closed 40p firmer, or 2.0%, at

20.00.

On the Continent, the

CAC 40

in Paris closed down 4.8, or 0.1%, at 6,258.6 and late in the German session the

Xetra Dax

in Frankfurt was up 23.9, or 0.4%, at 6,706.8. Even the Neuer Markt's tech-heavy

Nemax 50

index was able to trim the Intel driven losses and was 51.1 lower at 5,192.4.

In Frankfurt,

Siemens

(SMWAY)

was down 7.71 euros, or 4.9%, at 150.99 ($129.55), after having been down nearly 10% at the open.

Epcos

(EPC) - Get Report

fell 3.62 euros, or 3.7%, to 93.88,

Infineon

(IFX)

dipped 2.80 euros, or 4.8%, to 55.75. Software maker

SAP

(SAP) - Get Report

, however, was 1.50 euros higher, or 0.6%, at 260.50.

In Paris, French-Italian chipmaker

ST Microelectronics

(STM) - Get Report

closed down 3.20 euros, or 1.9%, at 59.05 and

Equant

(ENT) - Get Report

fell 1.66 euros, or 3.9%, to 40.99.

The telecom sector end the week on a mixed note, with

France Telecom

(FTE)

down 1.80 euro, or 1.6%, to 115.00,

Deutsche Telekom

(DT) - Get Report

off 0.75 euros, or 1.9%, at 38.50 and

Telefonica

(TEF) - Get Report

up 0.70 euros to 23.10.