Political wrangling in Italy and uncertainty in Cyprus resulted in a volatile day for London's FTSE 100 index on Wednesday, though stocks bounced well off their lows in afternoon trade.The Footsie dropped to an intraday low of 6,344 at midday, but had recovered to 6,388 by the close, tracking a slight rally in the US on the back of comments from Federal Reserve policymakers.The Boston Fed's Eric Rosengren and Sandra Pianalto from the Cleveland Fed both suggested that while stimulus measures were having their desired effect, policy should remain accommodative. Meanwhile, Minneapolis Fed President Narayana Kocherlakota reiterated his view that the Fed should keep monetary policy loose until the jobless rate falls to 5.5%, well below the Fed's current target of 6.5%.Eurozone concerns dampen sentimentThe political impasse in Italy has continued with centre-left leader Pier Luigi Bersani failing to persuade Silvio Berlusconi's centre-right party to support a minority administration. Instead Berlusconi has maintained his view that the two parties should form a coalition, something which Bersani has ruled out.This continuing uncertainty was reflected in the Italian Treasury's sovereign debt sale this morning, which experienced higher borrowing costs and relatively soft demand. Over the Cyprus, the government today announced capital control measures to prevent a run on the banks following the €10bn bailout package from the Troika, which includes a levy on all deposits over €100,000."Under the circumstances, it's difficult to see how temporary capital controls are going to do anything to stop a bank run. At best it will slow it, but as soon as large depositors can move their money away from the island, you can guarantee they will," said Market Analyst Craig Erlam from Alpari.Also weighing on markets were comments from Bart Oosterveld, the Managing Director of sovereign risk at Moody's, who said that the Cypriot bailout could have a negative effect on the credit ratings of other Eurozone countries. He said that policymakers are overestimating their ability to curb a contagion of the bailout to other countries. FTSE 100: TUI Travel flying high; Prudential dropsLeisure travel firm TUI Travel was a high riser after reiterating that full-year underlying operating profits would be at the top of the 7-10% guidance range. The firm hailed a decent winter 2012/2013 season and said that trading momentum going into the summer is "very strong".Providing a drag on the index were BSkyB, Smiths Group, British Land, Prudential and Schroders after going ex-dividend. Insurance firm Prudential was also under pressure after the FSA fined it £30m for the way the group handled its failed bid for AIA.Banking stocks were mixed today after the Bank of England said that financial institutions are facing a cumulative £25bn capital shortfall if potential losses are taken into account. RBS was a heavy faller today despite responding to the report saying that its capital position was "strong". Barclays edged higher on reports that it is marketing another round of contingent capital bonds (CoCos) to boost its loss-absorbing capital. Lloyds also finished with strong gains after Citigroup said that the bank's capital position is "robust" and that underlying earnings risks are to the upside.IAG was also flying lower after raising its bid for Spanish low-cost airline by 32%. The company also announced the departure of the CEO of its Iberia unit this morning.FTSE 250: ICAP slumps on full-year guidanceInterdealer broker ICAP said trading conditions in the last nine months have been extremely challenging and it expects full-year revenue to be 13% lower than the previous year, causing shares to tank.Egypt-focused gold producer Centamin fell despite saying that full-year production increased by nearly a third in 2012 while EBITDA jumped 10%.FTSE 100 - RisersTUI Travel (TT.) 322.80p +3.99%Weir Group (WEIR) 2,248.00p +2.79%Lloyds Banking Group (LLOY) 48.70p +2.20%Randgold Resources Ltd. (RRS) 5,670.00p +1.89%Rexam (REX) 527.50p +1.44%GlaxoSmithKline (GSK) 1,527.00p +1.26%Tesco (TSCO) 377.70p +1.19%Johnson Matthey (JMAT) 2,250.00p +0.94%Wood Group (John) (WG.) 863.50p +0.82%Diageo (DGE) 2,040.00p +0.74%FTSE 100 - FallersPrudential (PRU) 1,051.00p -4.28%Royal Bank of Scotland Group (RBS) 277.10p -3.11%International Consolidated Airlines Group SA (CDI) (IAG) 250.10p -2.27%Aviva (AV.) 297.50p -2.04%Schroders (SDR) 2,089.00p -1.92%Vedanta Resources (VED) 1,031.00p -1.90%Smiths Group (SMIN) 1,246.00p -1.73%British Land Co (BLND) 540.00p -1.73%Fresnillo (FRES) 1,376.00p -1.64%BG Group (BG.) 1,122.50p -1.54%FTSE 250 - RisersOcado Group (OCDO) 160.90p +3.81%St. Modwen Properties (SMP) 260.80p +3.49%Domino's Pizza Group (DOM) 603.00p +2.73%EnQuest (ENQ) 143.80p +2.49%United Drug (UDG) 271.50p +2.45%Dixons Retail (DXNS) 33.70p +2.12%SVG Capital (SVI) 408.40p +1.72%African Barrick Gold (ABG) 206.60p +1.57%Fenner (FENR) 391.60p +1.56%Restaurant Group (RTN) 466.30p +1.39%FTSE 250 - FallersICAP (IAP) 302.30p -6.29%Centamin (DI) (CEY) 53.65p -4.62%Synthomer (SYNT) 211.90p -4.55%Hochschild Mining (HOC) 285.30p -4.26%Rathbone Brothers (RAT) 1,429.00p -4.03%Alent (ALNT) 362.30p -3.85%Carillion (CLLN) 274.50p -3.82%New World Resources A Shares (NWR) 224.20p -3.78%Kenmare Resources (KMR) 30.10p -3.68%Carpetright (CPR) 625.00p -3.55%BC
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