Growing optimism about the global economy following robust Chinese trade data lifted Britain's top share index to a 16-month high on Monday, as miners and energy stocks climbed on the back of firmer raw material prices.
By 0903 GMT Britain's FTSE 100 was up 61.61 points at 5,595.85, having touched its highest level since September 2008, after closing up 7.52 points, or 0.1 percent on Friday.
China's exports and imports last month blew past expectations, with exports leaping 17.7 percent from a year earlier, dwarfing the 4 percent rise forecast by economists and breaking a 13-month streak of year-on-year declines.
This helped lift crude to above $83.50 per barrel and metal prices were up, boosting heavyweight commodity stocks.
Miners Rio Tinto, Xstrata, Lonmin, Anglo American, Kazakhmys and BHP Billiton added 2 to 3.9 percent.
Energy stocks BG Group, BP, Royal Dutch Shell gained 1.8 to 3.2 percent, helped by a bullish note on the sector from Citigroup, which raised targets and hiked its rating for BP to "buy" from "hold".
"Apart from Chinese exports rising, imports were also up around 50 percent, and a lot of that was raw materials, which is feeding through to mining stocks, although it is a broad-based rally," said Richard Hunter, head of equities at Hargreaves Lansdown.
Banks, often beneficiaries of improved appetite for risk, were also firmer. Barclays added 1 percent, helped by an upgrade to "buy" from "hold" by Citigroup, while HSBC, Royal Bank of Scotland, and Lloyds Banking Group gained 0.2 to 1.6 percent.
Property stocks were also firmer, helped by a positive note from Goldman Sachs, which raised targets across the board.
Land Securities gained 2 percent after being added to the broker's "Conviction Buy" list, while Segro was also up 2 percent after it was raised to "neutral" from "sell". Segro also found support as it reported trading in line with expectations. .
CLOUDS ON HORIZON
Hinting that the UK economy faces a sluggish recovery, British finance firms saw a smaller-than-expected rise in business activity during the final quarter of 2009 and most expect a fresh decline in the next three months, according to an industry survey.
Also emphasising hard times ahead, British finance minister Alistair Darling said on Friday his priority was to cut the budget deficit, warning the next government spending review would be the toughest in two decades.
SABMiller was the heaviest faller among the few stocks in negative territory after it dropped out of an auction to buy the beer business of Mexico's Femsa, leaving Dutch peer Heineken to snap it up.
Some other defensive stocks were also weaker, with Imperial Tobacco and power network operator National Grid down 0.5 and 0.2 percent, respectively.
U.S. stocks rose on Friday after trading in the red most of the day as investors concluded that weak December jobs data would not interrupt a trend of steady economic recovery.
No important UK or U.S. data is due on Monday, though markets will be interested in Alcoa's fourth-quarter results, marking the start of the latest U.S. earnings reports cycle.
