London’s top-flight finished the session 77.95 points higher at 7,015.36, while Germany’s Dax and France’s Cac 40 were also strongly ahead.
Sentiment across European markets was helped by Greece meeting a deadline to repay a loan instalment to the International Monetary Fund.
Meanwhile in the US, minutes of the most recent meeting of the Federal Reserve showed members were divided between an interest rate hike in the summer and a move next year.
BP continued to rise following speculation about it becoming a takeover target. A small rebound in the oil price also helped as shares rose 6.4p to 463.7p.
It comes after Royal Dutch Shell’s announcement in the previous session that it had agreed to swallow up exploration firm BG for £47 billion.
BG built on the 27 per cent surge sparked by the move as it added 7p to 1,160p while Shell gained 12.5p to 2,032p.
Luxury fashion label Burberry was ahead after speculation linking the company to a takeover bid from a US-based private equity firm. Shares climbed nearly 3 per cent or 49p to 1,792p.
Tony Cross, market analyst, Trustnet Direct, said: “Spurred along by that prospect of Shell buying BG Group, there’s no shortage of rumours in play driving other stocks higher, whilst the run of inaction by central banks is also helping prop up equities.”
Among smaller stocks, Flowgroup edged up 0.5p to 31.62p as it announced type approval for the production line and volume manufacture of its new boiler at partner Jabil’s facility in Livingston.