Britain's top share index advanced for a third straight session on Wednesday, reflecting strength on Wall Street on optimism about the housing sector, with commodity stocks and banks among the top risers.
At 0901 GMT, the FTSE 100 was up 34.35 points, or 0.6 percent, at 5,363.01, after rising 2.5 percent in the previous two sessions, albeit in thin pre-Christmas trade.
Energy stocks, aided by a 0.2 percent rise in the crude price, were in demand. BP, Royal Dutch Shell and BG Group put on 0.8 to 1.1 percent.
Cairn Energy, which on Monday said it had secured a rig to allow it to commence a drilling programme offshore western Greenland, rose 1.1 percent.
"I suppose now we're really into the end of some book adjustments just to make things look pretty for the year end," said Stephen Pope, chief global market strategist at Cantor Fitzgerald.
U.S. stocks rose on Tuesday on a surge in existing home sales, which indicated more stabilisation in housing and boosted optimism about the economic recovery.
Banks were in favour, with Barclays, HSBC, Lloyds Banking Group and Standard Chartered adding 0.8 to 1.6 percent.
Mining stocks rose against a backdrop of firmer metals prices. Eurasian Natural Resources, Lonmin, Rio Tinto and Vedanta Resources adding 1.2 to 1.6 percent.
BROAD-BASED RALLY
Defensive issues were also swept higher by a fairly broad-based pre-Christmas rally.
Pharmaceutical stocks GlaxoSmithKline and Shire rose 0.3 percent and 0.7 percent, respectively, with British American Tobacco and Imperial Tobacco up 1.9 and 0.2 percent.
The UK blue chip index has surged about 55 percent from a six-year low hit in March, but is still 1.1 percent below its level of mid-September 2008 before the collapse of Lehman Brothers.
The Daily Mail reported, citing authoritative sources, that Britain's central bank is prepared to expand its quantitative easing programme to ensure economic recovery is sustained.
Investors will be eyeing the minutes from the BoE's latest interest rate policy meeting, scheduled for release at 0930 GMT.
On the other side of the Atlantic, U.S. new home sales data for November, due at 1500 GMT, will be a focus for investors.
