After two days of decline, a combination of well received company updates and positive economic news helped push leading shares to a near eleven week high.
The FTSE 100 finished 42.81 points higher at 6839.25 - its best level since 24 February - helped by hints from the European Central Bank that it might act to combat low inflation next month, upbeat Chinese trade figures, and an easing of concerns over Ukraine after Wednesday's conciliatory comments from Russia'sVladimir Putin. Chris Beauchamp, market analyst at IG said:
Central bankers seem to be doing their (unintended) best to talk up global equity indices at present, as first Janet Yellen [at a testimony] and then Mario Draghi uttered words that served to soothe the frayed nerves of traders. Ms Yellen [carefully tiptoed] around the question of when the first rate hike would take place. Today, Mario Draghi effectively signalled some sort of action in June to fight the ongoing menace of low inflation in the eurozone.
On the corporate front, investors appeared to like the idea that Barclays would take the axe to 19,000 jobs, pushing its shares up 19.15p to 262.45p.
BT closed 10.8p better at 387.6p after in-line full year profits of £6.1bn, unchanged despite hefty investment in its sports operations.
Prudential climbed 16p to 1393.5p following news of 29% growth in first quarter new business, while Barratt Developments was up 6.2p to 382.5p after announcing a 47% rise in forward sales.
Despite the dismal times continuing at Morrisons, with a 7.1% fall in underlying first quarter sales, the supermarket's shares recovered from early falls to end 8.1p higher at 198.9p.
But British Gas owner Centrica came under pressure, closing 6.4p lower at 320.4p as it warned of a reduced outlook for earnings in 2014.
Sage was the biggest faller in the FTSE 100 despite in-line figures, down 22.5p to 399.5p as the accounting software specialist announce the retirement of its chief executive.
Guy Berruyer will step down sometime in the next eleven months, the company said, as it reported a 4.9% rise in first half revenues to £657m (before the negative effect of exchange rates) and said it was confident for the rest of the year. Analyst Julian Yates at Investec repeated his sell recommendation, saying Berruyer's proposed departure was unexpected.
Meanwhile AstraZeneca added 82p to £47.13p on talk of a higher bid of around £53 a share from predator Pfizer.
Among the mid-caps SuperGroup, the fashion retailer behind the Superdry brand warned full year profits would be at the lower end of City forecasts of £61m to £65m after fourth quarter like for like sales fell 3.1%. It blamed the late timing of Easter and a planned reduction in lower margin sales through eBay.
Its shares slumped 169p or 12.5% to £11.79.
Lower down the market, directors at EKF Diagnostics spent £87,500 on buying up stock after Wednesday's share decline, helping the company recover 0.125p to 25.625p.
Finally Hume Capital lost 29% to 0.135p after the investment management group announced the surprise resignation of chief executive Nitin Parekh and said it was considering new funding. It said:
The board is currently undertaking a review of the company, and in particular, is looking to ensure the company's financial resources are adequate to fund the business for the foreseeable future. In this regard, the board is in advanced discussions with a group of investors who have indicated they are willing to provide funding into the company should this be necessary in either the short or medium term.
In April Hume, chaired by former Barclays executive Sir Peter Middleton, halted its market making activities. The move prompted talk that Haydale Graphene Industries, floated with Hume as its broker on the same day as the market making decision was announced, was planning legal action against Hume. Haydale responded by saying it had no current intention of doing so.