All major US share indexes rise by more than 1% following strong trading in Europe
FTSE 100 closes up 2.64% and FTSE 250 closes up 3.58%
Sterling rises 0.88% to $1.3342
US Volkswagen owners get compensation for emissions scandal
Chancellor George Osborne warns of tax rises and spending cuts
Image source, Getty ImagesUS regulators have confirmed that Volkswagen will pay $15.3bn (£11.2bn) to resolve the emissions scandal that affected about 580,000 diesel cars.
The German car maker will set aside $10bn to buy back vehicles and separate settlements will be announced with at least 44 states.
The latest pensioner incomes data from the ONS, external shows that average pensioner incomes have grown closer to those of workers.
In 1994/95 pensioner incomes were 38% lower than average workers' incomes, but by 2014/15 the gap had narrowed to just 7%.
Tom McPhail, head of retirement policy at Hargreaves Lansdown: "Today's pensioners have worked hard for their prosperity and there are still areas of inequality, both regionally and in terms of age, with older pensioners having lower incomes. Nevertheless, this news is likely to exacerbate inter-generational tensions."
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Today business presenter Dominic O'Connell tweets:
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Business producer Mark Broad adds:
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Image source, Getty ImagesOne clear message from the EU referendum was that "parts of our country felt left behind", the Chancellor says.
Pushed on what that means for the Northern Powerhouse, George Osborne points to some progress on electing mayors, lining up transport projects and investing in science facilities in the north of England.
"We've got to make that work now," he says. "The referendum result is even more an instruction to deliver that [Northern Powerhouse] and make it a reality for people."
George Osborne - once the heir apparent for Number 10 - is explaining a bit more about his decision not to run as Conservative leader.
The party was split on the referendum, he says, and so he doesn't think "someone who was as prominent in the campaign as I was could realistically bring the party together".
More headwinds for London emerging as the headquarters for a merged London Stock Exchange/Deutsche Boerse.
Felix Hufeld, head of German financial market regulator Bafin, said: "It is hard to imagine that the most important exchange venue in the eurozone would be steered from a location outside the EU."
Bafin, which answers to Germany's finance ministry, cannot veto the deal, but its opinion still counts.
Image source, AFP/Getty ImagesGeorge Osborne is speaking at The Times CEO Summit.
He opens by saying he's just posed for a photograph with the owner of a pop-up shop called Win or Lose.
"Win or lose he's in business. Win or lose I'm in business," the Chancellor quips.
At lunchtime the FTSE 100 was holding firm at about 6,130 points - a 2.4% increase. Insurers Prudential and Legal & General were leading the way, with retailer Next also a big winner.
There are just three fallers on the index: Fresnillo, Randgold and Shell.
The FTSE 250 - seen as a better indicator of UK businesses - is also 3% higher at 15,417 points.
However, Spreadex analyst Connor Campbell warns: "Today's rebound is likely just investors searching for the lows."
Economics editor Kamal Ahmed tweets:
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Online grocer Ocado's shares are flying off the shelves. It's one of the biggest winners on the FTSE 250 so far - rising almost 10% in morning trading - after posting an increase in profits.
The firm has also said it's not suffering from Amazon's launch earlier this month of a supermarket service in London.
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Image source, Getty ImagesBusiness Secretary Sajid Javid is meeting business leaders today to discuss the fallout from the Brexit vote.
Trade unions, however, will not be there after they say the government told them their attendance was "unwarranted".
Frances O'Grady, head of the Trade Union Congress, said: "Ministers should be working with us to ensure that working people do not pay [the] price of leaving the European Union."
The Business Department said Mr Javid had a call scheduled with Ms O'Grady this afternoon and would continue to work with the unions.
Image source, Getty ImagesWillie Walsh, chief executive of British Airways owner IAG, says that in addition to the pound and the euro both weakening against the US dollar, higher oil prices will increase costs for the company. He adds: "The pound is going to be structurally weaker against the dollar."
IAG shares are up 3.8% today - but the stock is still down almost 25% in the past five days.
Crude oil was trading at almost $48.50 a short while ago - an increase of $1.30 on the day and around $20 higher than the lows it hit at the start of the year.
Image source, NextBargain-hunting investors are helping to drive today's FTSE rally, says Chris Beauchamp from online trading platform IG.
"A lot of people with the stock market equivalent of an Amazon wish list will have gone shopping in the past couple of days, and may continue to do so," he says.
Retailer Next (shares up 9%) and insurer Prudential (up 11%) are among the stocks being snapped up.
Sticking with house prices for a moment, Land Registry data, external out today shows how much the most expensive property sold for last month...
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Samuel Tombs, UK economist at Pantheon Macroeconomics, estimates what the plunge in property developers' shares might mean for house prices.
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With the FTSE 100 up about 150 points, or 2.5%, the mid-cap FTSE 250 has also ended its slump to rise 3% so far today.
AO World is the top riser, up 12%, with Ocado jumping 9.5%.
CMC Markets analyst Michael Hewson said: "The FTSE 250 has declined quite sharply over the past couple of days, and you can't sugarcoat that ... and what's happened now will affect the UK economy more than it will affect the global outlook. But we're still above 2014 lows for the index, and so there will be good buying opportunities around these levels."
Kamal Ahmed
Economics editor
Maybe not quite the five stages of grief, but the Chancellor, George Osborne, has certainly been on a journey since the voters of the UK rejected his exhortations to vote Remain last Thursday.
Speaking to those close to him, that journey has been something of a knackering, stomach-churning roller coaster.
But now, a possible destination is becoming clearer, in his mind at least. And it's not the one many expected.
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Image source, Getty ImagesRoyal Bank of Scotland boss Ross McEwan has warned staff that the Brexit decision has caused a range of economic uncertainties "in the short, medium and long term".
In a memo, the New Zealander noted that the result had spread beyond markets and into "everyday exchanges between colleagues, friends and family".
"As someone born outside the UK, I see one of this country's biggest strengths as its openness to the rest of the world, and the people of it. As a major employer and backer of the economy we have a duty to ensure that we reflect that," he said.
"The diversity of those who make up this bank at every level is key to our success. In uncertain times I want to ensure that everyone understands that."
Shares in RBS plunged on Friday and Monday, but are up 3.5% today. The stock has shed 40% this year.