Stock markets rally at the end of a traumatic week

Deputy Federal Reserve chair Bill Dudley said the US economy has momentum to withstand weakness from abroad

A recovery in US consumer spending revived battered stock markets in Europe and New York on Friday, despite the latest eurozone GDP figures showing a broad slowdown across the currency union and Greece slipping back into recession.

The FTSE 100 soared 169 points to register the strongest daily increase since last August, before the Dow Jones index followed suit in New York, wiping out much of the losses from earlier in the week as January figures for US consumer spending beat expectations. The FTSE 100 still ended the week down 2.4%.

Related: Eurozone recovery falters as Greece slips back into recession