Britain's top shares were 0.2 percent higher in early deals on Tuesday, bolstered by firmer banks as heavyweight HSBC rallied after its results disappointed in the previous session.
At 0918 GMT, the FTSE 100 index was 8.18 points higher at 5,414.12, nearing a six-week peak, having closed 51.42 points, or 1 percent higher on Monday.
"HSBC's bounce is keeping the market positive but underlying jitters remain, particularly after sterling's slide on Monday, with investors scared by prospects that the upcoming (British) general election will bring no clear party winner," said Mic Mills, senior trader at ETX Capital.
Banks led the market gainers early on, with HSBC rebounding 0.8 percent after its sharp fall on Monday following below-forecast results.
Standard Chartered, set to post full-year numbers on Wednesday, added 0.1 percent, while Barclays and Royal Bank of Scotland took on 0.5 percent and 0.1 percent respectively.
Energy issues also provided a prop for blue chips, with Royal Dutch Shell, BG Group, and explorer Cairn Energy up 0.3-0.6 percent as the crude price held above $78.50 a barrel.
BP, however, slipped 0.4 percent. The company is to form a joint venture with privately owned Lewis Energy to exploit Lewis's Eagle Ford shale gas assets, in a deal worth around $200 million, a source familiar with the matter said.
Miners were mixed. Randgold Resources added 1.4 percent as the gold price reached a new record when priced in sterling, while Mexican silver miner Fresnillo gained 1.4 percent following better than expected results.
Fresnillo posted a forecast-beating 141 percent rise in 2009 profit on higher prices and stronger output, but warned of volatile markets.
But as the copper price drifted back after strong gains on Monday, Anglo American and Rio Tinto shed 0.1 and 0.2 percent respectively.
The biggest individual blue-chip gainer was ARM Holdings, up 2.5 percent and supported by an upbeat outlook statement from U.S peer SanDisk and by a bullish note on the chip sector from UBS.
ADMIRAL SINKS
Motor insurer Admiral Group was one of the biggest FTSE 100 fallers, down 1.0 percent after in-line full-year results failed to excite.
Life insurer Prudential was the biggest blue-chip loser, down 5.2 percent, extending Monday's falls following its move to buy American International Group's Asian arm for $35.5 billion, funded by a $21 billion rights issue.
Other insurers were unsettled by the Pru's move, with liquidity in the sector likely to be hit by the mammoth cash call and hopes for other takeover deals dented.
Aviva shed 1.8 percent, while Legal & General, Standard Life , and Old Mutual fell 0.5-2.1 percent.
Sterling was also a drag on investor sentiment as the currency recovered slightly but still remained under pressure after hitting a 10-month low on Monday on concerns the pending British general election will results in a hung parliament.
Polls over the weekend suggested Gordon Brown's ruling Labour party may just hang on for another term, as the opposition Conservatives saw their lead cut back, with neither looking likely to secure a parliamenary majority.
