The FTSE 100 closed marginally in the black after a strong morning session was almost wiped out by “shocking” US labour market figures.
Other major European markets also slipped towards the end of trading as the extent of the outbreak’s impact was revealed.
The FTSE 100 closed 25.65 points higher at 5,480.22 at the end of trading on Thursday.
It was knocked from a Midday peak after new data revealed that the number of Americans filing for first-time unemployment doubled to more than six million, hitting a record high for the second consecutive week.
David Madden, market analyst at CMC Markets UK, said: “It has been a volatile session in Europe today as equity benchmarks pushed higher in the morning, but the positive sentiment was derailed by the shocking jobs data from the US.
“The major equity benchmarks in Europe are just about hanging into gains in the wake of the comments from President Trump about oil.”
However, analysts suggested it was still a positive sign that the markets did not slump into the red in the wake of the poor figures.
Connor Campbell, financial analyst at Spreadex, said: “It still, however, marks the second week in a row investors have taken a terrifying unemployment claims figure relatively in their stride.”
On Wall Street, the Dow Jones was particularly resilient to the figures as it lifted slightly higher on the back of strong energy stocks.
The major European markets finished marginally higher as they rebounded from disappointing industry figures on Wednesday
The German Dax increased by 0.27%, while the French Cac moved 0.33% higher.
Meanwhile, sterling has continued its recent rebound to move higher against the euro and dollar, with traders calmed by a lack of major economic updates.
The value of the pound rose 0.07% versus the US dollar at 1.237 and was up 1.15% against the euro at 1.140.
The price of oil surged after President Donald Trump said that Russia and Saudi Arabia could cut output by 10 million barrels per day.
The price of a barrel of Brent crude oil increased 18.28% to 30.28 US dollars
The UK’s oil majors and commodity firms drove higher as a result, with Royal Dutch Shell jumping 120.4p higher to 1,541.6p, and BP shares rising 19.65p to 353.35p.
In company news, Morrisons shares slipped slightly after staff were told to expect a more than £1,000 windfall as the company pledged to triple their annual bonuses.
Shares closed 1.5p lower at 179p.
Elsewhere, British Gas owner Centrica slid after it confirmed a pay freeze for non-customer facing staff amid actions to cut costs by around £400 million.
The group said it was seeing increased demand for energy among households as Britons have been forced to stay at home, but it added it was being hit by a “more significant” impact from falling business energy use as firms.
Shares fell by 3.19p to 33.92p.
The biggest risers on the FTSE 100 were Royal Dutch Shell, up 120.4p at 1,541.6p, M&G, up 9.8p at 118.8p, Glencore, up 120.4p at 1,541.6p, and BP, up 7.72p at 126.88p.
The biggest fallers of the day were Carnival, down 174p to 605p, Rolls-Royce, down 26.7p at 278.3p, Centrica, down 3.19p at 33.92p, and Informa, down 34p at 374.9p.