A new scheme to inject more dollars into the European financial system helped banking shares lead world markets higher today.
London’s FTSE 100 Index rose 2%, or 110.5 points to 5,337.5, while the Dax in Germany and the CAC 40 in France were up 3%.
Traders were earlier encouraged by comments from Nicolas Sarkozy and Angela Merkel pledging to do all they could to keep Greece in the eurozone.
The recent recovery of banking stocks continued in London after an upbeat note from broker Nomura.
It upgraded HSBC and Barclays to buy from neutral, causing the pair to rise 19.6p to 521.1p and 6p to £1.58 respectively.
Royal Bank of Scotland, which dipped to 20p earlier this week, rose 0.9p to 23.7p, while Lloyds Banking Group was the biggest riser, up 7%, or 2.4p to 35.9p.
Retail stocks rallied for a second successive session after B&Q owner Kingfisher produced better-than-expected half-year results.
It was up 5%, or 11.5p to 251.1p after a number of analysts upgraded their forecasts in the wake of a 25% rise in half-year profits.
Marks and Spencer lifted 4.3p to 330.8p and Primark owner Associated British Foods added 17p to £10.83.
Kesa Electricals overcame a 22% drop in like-for-like sales at Comet to post a 5% share price rise to 91.6p.
Dunelm was another retailer on the rise after it revealed a 9% rise in annual pre-tax profits and lifted its total dividend by 43.8% to 11.5p. Shares rose 6%, or 24.8p to 451.9p in the FTSE 250 Index.
Stuart Lamont, of investment manager and financial planning specialist Brewin Dolphin in Aberdeen, highlighted Nautical Petroleum up 7.43% to 288.75p, Aberdeen Asset Management climbing 5.24% to 188.75p and Wood Group 4.3% higher at 569.5p
The day’s laggards included EnCore Oil down 2.43% to 50.25p and A.G. Barr off 1.14% at 1218.5p.