Stock markets on both sides of the Atlantic rebounded strongly on Monday from multi-year lows and the FTSE 100 index enjoyed its biggest ever one-day gain, as investors welcomed an eleventh-hour bail out of the US banking group Citigroup.

The US government’s $306bn rescue of the company, which included a $20bn capital injection, gave US and European equities a powerful shot in the arm and drove bond yields up from record lows.