Britain's leading share index gained 0.8 percent early on Tuesday, the last full session of 2008, reflecting overnight gains in Asia and led by strength in commodity issues as oil, metal prices firmed.
By 0853 GMT, the FTSE 100 index was up 35.04 points at 4,354.39. The UK blue chip index closed 102.76 points higher at 4,319.35 on Monday.
"Since there will not be any economic data today, the FTSE is most likely to spend the day in positive territory", said David Evans, market analyst at BetOnMarkets.com.
Heavyweight oil issues again provided the main strength for the UK blue chips early on as crude prices held steady below the $40 a barrel level.
Shares in BP, Royal Dutch Shell, BG Group, and Tullow Oil gained between 1.1 and 1.7 percent.
Similarly miners also found fresh support, with Eurasian Natural Resources, BHP Billiton, Rio Tinto and Xstrata up between 0.4 and 3.5 percent.
Overall, however, the FTSE 100 index is set to record its worst annual performance in its history when the markets close for 2008 at 1230 GMT on Wednesday, having lost over a third of its value since the start of the year.
"All eyes are on what 2009 has to bring, with a year of two halves expected," said Henk Potts, strategist at Barclays Stockbrokers.
"Shares will remain volatile in the first quarter, and then as the economic backdrop improves in the second half equities should start to pick up. There is hope after a destructive and dismal 2008," Potts added.
Real Estate issues bounced back following sharp falls on Monday amid worries about the strength of the commercial letting market following the collapse of a number of retail chains.
Hammerson, British Land, Land Securities and Liberty International rallied 0.6 to 3.3 percent.
Aerospace and defence group Rolls-Royce added 1.2 percent, benefiting from contracts news.
The firm said on Tuesday it has won a compressor contract for a new Russian-European gas pipeline from a Gazprom subsidiary.
Rolls-Royce was awarded a $221.7 million contract modification for MV-22 and CV-22 AE1107C engines for the U.S. Navy, according to a Pentagon daily contract list released Monday night.
Peer BAE Systems was also in demand, up 3.3 percent.
Financial issues, however, were a big drag on blue chip sentiment as investors shunned the sector after a dismal 2008, notably for the banks in the eye of the credit crunch storm.
HBOS was a big blue chip faller, down 2 percent.
HBOS' pension scheme trustees may ask a judge to postpone Lloyds TSB's proposed takeover of the bank until "appropriate arrangements" have been made to guarantee the merged business will stand behind the fund, the Financial Times said.
Lloyds TSB suffered as well, down 1.5 percent, while Barclays lost 0.3 percent.
But Asian-oriented banks Standard Chartered and HSBC rose 1.6 and 0.6 percent respectively, reflecting strong gains in equity markets in the region Tuesday.
Selected insurers were shunned as capital raising worries continued to dog the sector, with Prudential, Friends Provident down between 0.6 and 2.2 percent.
