Fresh hopes of a bailout deal for debt-stricken Greece sent the London market sharply higher after two straight sessions of heavy losses.
“There was stifling heat in the City of London on Wednesday but stock markets weren’t losing their cool over the crises in Greece,” said Jasper Lawler, market analyst at CMC Markets UK.
“Greek prime minister Tsipras offered enough hope to spring a relief rally by suggesting Greece would meet most of the demands of its creditors in the most recent proposal. However, Greek banks remained closed while the European Central bank deliberated providing more emergency funding.”
The FTSE 100 Index, which plunged almost 100 points on Tuesday, ended the session 87.61 points higher at 6,608.59, with financial stocks leading the way among the blue chips.
Royal Bank of Scotland was the biggest top-flight riser, jumping 11.2p or 3.2 per cent to 362.7p. Barclays was up 6.05p at 266.55p and Lloyds Banking Group 1.62p higher at 86.86p.
However, HSBC lagged behind, edging up just 0.8p to 570.9p, after Bank of England governor Mark Carney said that global lenders considering moving their headquarters out of the UK cannot expect to gain easier regulatory treatment.
Outside the top flight, scandal-hit outsourcing group Serco saw its shares surge higher after revealing its turnaround has started to get the business back on track in its first half.
The FTSE 250 firm, headed by former Aggreko boss Rupert Soames, said trading had been “a little better than we anticipated”, sending shares soaring 7.7p or 6.5 per cent to 125.7p as investors breathed a sigh of relief after a couple of torrid years for the group since it admitted that it had charged the government for tagging thousands of criminals who were dead or non-existent.