Gains in HSBC after strong third-quarter results outweighed weakness in Vodafone as its results disappointed, pushing Britain's FTSE 100 up for the fifth straight session on Tuesday.
By 0914 GMT, Britain's top share index was 27.0 points or 0.5 percent higher at 5,262.18, hitting its highest in two weeks after it gained 1.8 percent the previous session.
It is up 51.9 percent since touching a six-year trough in March.
In its third-quarter results, banking heavyweight HSBC said its global banking and markets division is having a record year and that losses on consumer loans had shown their first fall in three years, lifted its shares 3.2 percent.
The market was also boosted by strong gains on Wall Street the previous session, in which the Dow Jones industrials average rose to its highest in 13 months.
"The bank numbers were decent and there's a general view that this is a positive for the market … and the gains from the U.S. are also lifting the market," said Peter Dixon, economist at Commerzbank.
But Barclays shares fell 2.1 percent, reversing gains the previous day. The bank said strong investment banking powered a 1.56 billion pound ($2.6 billion) profit in the third quarter, helping offset a big bad debt charge as the bank restarted paying dividends.
Royal Bank of Scotland added 3.2 percent.
Economic news suggested Britain is moving steadily out of recession, also boosting sentiment on the equity market.
House prices in England and Wales rose last month at their strongest rate in almost three years, buoyed by tight supply and record low interest rates, a survey showed.
Another poll showed UK retail sales values rose last month at their fastest annual pace since April to notch up their best October showing in seven years.
Imperial Tobacco gained 3.7 percent after it beat forecasts with an 18 percent rise in full-year earnings.
Energy stocks were also a positive for the index as crude held near $80 per barrel. BG Group, BP, Royal Dutch Shell added 0.2 to 0.5 percent.
But gains on the index were limited by a 2.2 percent dip in mobile telecom heavyweight Vodafone. Analysts said a focus on cost cutting failed to inspire investors after it reported first-half revenue and earnings in line with forecasts.
