This comes as the number of daily new COVID-19 infections in the United States seems to be stabilising. S&P 500 futures ESc1 traded flat.

The bond market was steady after a huge auction and the generally upbeat mood drove selling overnight, with benchmark 10-year US debt yielding 0.6622%.

A softer dollars helped gold rise steadily, adding 1% to $1,937 an ounce after whipsawing around $1,900 overnight.

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4.20pm updates: US stocks rise on Nasdaq open but S&P 500 and Dow flat

The US Nasdaq Composite rose as Apple inched towards a $2trillion in market capitalisation.

Meanwhile the S&P 500 and Dow indexes faced less positive news appearing flat in comparison with data signalling a faltering labor market recovery.

The S&P 500 remained within striking distance of a record high, the blue-chip Dow was weighed down by a 10.9% slump in Cisco Systems Inc after the company forecast first-quarter revenue and profit below estimates.

Dan Eye, head of asset allocation and equity at Fort Pitt Capital Group in Harrisburg, Pennsylvania said: ”We've had a really strong run over the last couple of weeks, so I think it will be very healthy to see a pause, some consolidation here.”

The number of Americans seeking unemployment benefits dropped below one million last week for the first time since the start of the coronavirus outbreak in the US but that was likely due to the expiration of a $600 weekly jobless supplement that discouraged some from filing claims.

Mr Eye added: “There's definitely a stalemate there and it just seems like the market has decided to take an optimistic view around the stimulus talks that's right in line with how markets are looking at every outcome - the economic recovery, earnings recovery, vaccines.”

3.45pm update: The FTSE-100 index is down 82.84 at 6197.28

3.30pm update: Irish PM sees "landing zone" for Brexit after talks with Boris Johnson

New Irish Prime Minister Micheál Martin believes there is a "landing zone" for securing a post-Brexit trade deal between the UK and EU after meeting with Boris Johnson.

Mr Martin said he and the UK Prime Minister, who met in British-ruled Northern Ireland, had agreed on the "absolute necessity" that such an accord would be tariff and quota free and on the need to reach a deal as quickly as possible.

The Irish Prime Minister said: “It seems to me that there is a landing zone if that will is there on both sides, and I think it is.

"My own gut instinct is that there is a shared understanding that we don't need another shock to the economic system that a sub-optimal trade agreement would give alongside of the enormous shock of COVID.”

2.45pm update: The FTSE-100 index is down 81.36 at 6198.76

2.20pm update: Spain says US should waive tariffs on EU goods as wine and olives hit

The Spanish government has said it rejects a US decision to maintain tariffs imposed on EU goods after Washington decided to keep 15 percent tariffs on Airbus aircraft and 25 percent tariffs on other European goods.

Spanish agricultural exports such as wine and olive oil are said to be among the hardest hit by the US tariffs.

Washington took its action despite moves by the EU to resolve a 16-year-old dispute over aircraft subsidies.

Spanish Agriculture Minister Luis Planas said retaliating on agriculture was a "strategic error" as the industry needs stability.

1.45pm update: The FTSE-100 is down 61.79 at 6218.33

1.10pm update: German yields go into neutral as supply-induced selloff wanes

German yields have stabilised after traders began to feel they may have overreacted at a Bund selloff, which they feared could mirror the rise in US yields on the back of the largest-ever 10-year US Treasury auction.

Lyn Graham-Taylor, fixed income strategist at Rabobank said: ”Yesterday's move was quite big but wasn't really based on anything.

"It doesn't completely surprise me that on opening this morning, it would marginally be the other way.”

He added bond markets were likely to stabilise from here and stall because "the bottom of the economy is as low as people thought, but everyone thinks the recovery is going to be slower than they thought".

12.45pm update: The FTSE-100 index is down 64.19 at 6215.93

12.10pm update: UK negotiator David Frost confident trade deal with EU can be reached next month

Mr Frost said on Twitter: "Our assessment is that agreement can be reached in September and we will work to achieve this if we can.

"As we keep saying, we are not looking for a special or unique agreement. We want a deal with, at its core, an FTA like those the EU has agreed with other friendly countries, like Canada.

"The UK's sovereignty, over our laws, our courts, or our fishing waters, is of course not up for discussion and we will not accept anything which compromises it - just as we aren't looking for anything which threatens the integrity of the EU's single market."

11.45am update: The FTSE-100 index is down 56.30 at 6223.82

11.30am: Pound rises against dollar

Sterling is rising against the dollar, driven by dollar weakness as traders shrugged off yesterdsay's dismal GDP data.

Britain's economy shrank by a record 20.4% in the second quarter - a substantially bigger slump than in the euro zone (12.1%) or United States (9.5%), data on Wednesday showed.

But the pound did not decline significantly on the news, which was outweighed by dollar weakness by the end of the session, which pushed cable up.

"In reality, most market participants had been pencilling in a decline in Q2 GDP of 'around' 20% for some time now so yesterday's release from the ONS didn't come as too much of a surprise even if the magnitude of the contraction dwarfs anything any of us have experienced before," RBC strategists wrote to clients.

Sterling was at $1.3077 at 0744 GMT, up 0.4% since New York's close versus a weaker dollar. So far in August, it has been broadly in line with its pre-pandemic levels.

Versus the euro it was little changed, at 90.46 pence per euro.

10.45am update: The FTSE-100 index is down 60.14 at 6219.98

10.30am update: Rough start for EU markets

Like FTSE, EU markets have also struggled this morning.

As of 10.30am BST, Euronext 100, CAC 40, DAX and Swiss Market Index are all struggling.

Euronext is down 0.18%, CAC is down 0.06%, DAX is down 0.02% and Swiss Market is around even on the day.

9.30am update: FTSE continues early morning slump

After a bleak start on open, FTSE has continued to fall this morning.

FTSE plummeted from 6,280 to 6,220 on open this morning - a huge loss.

It has since continued its downward trend, now sitting at 6,204.

8am update: FTSE plummets

FTSE has plummeted on open, a day after it was revealed the UK has officially entered recession.

The UK closed at 6,280 after a positive day, rising from 6,154.

However, this morning the index has already dropped to 6,220.

More to follow...