Stock markets bounced back regaining some of the ground lost recently, after China cut its main interest rate for the fifth time in nine months to bolster its slowing economy.
London's FTSE 100 Index jumped 182.5 points to 6081.3, as Chinese interest rates got reduced by another 0.25 percentage points to 4.6 per cent following punishing falls in equities over recent days.
The market added about £47 billion back on to the value of the UK's top 100 listed companies, after £74bn was wiped off the index in the previous session.
The top flight lifted 3.09 per cent, its biggest one-day rise since September 7, 2011, when it climbed by 3.14 per cent.
Germany's Dax and France's Cac 40 were each up by around four per cent. In New York, the Dow Jones Industrial Average was up by more than 350 points at the time of the close in London.
The pound was down a cent against the US dollar, at just under 1.57, after a raft of positive American economic data. Sterling was two cents up against the euro at just under 1.38.
The move in China added fuel to an early session bounce back after shares worldwide plunged on Monday.
The FTSE 100 had tumbled by 4.7 per cent in its worst one-day fall since September 2011.
China reacted after more share falls in Asia overnight, where the Shanghai composite index fell 7.6 per cent to take it to an eight-month low.
The People's Bank of China also increased the amount of money available for lending by reducing the minimum reserves banks are required to hold by 0.5 percentage points.
Markets have been plunged into turmoil over slowing growth in China, the world's second biggest economy, and tumbling commodity prices.
London-listed mining giants have been badly hit, but their shares were seeing a recovery in the latest session.
BHP Billiton was one of the biggest climbers in the rebound, despite posting worse than expected annual results for the year to the end of June 30.
Underlying attributable profits fell 51.6 per cent to $6.4 billion (£4.1bn) and net profits crashed 86 per cent to $1.9bn (£1.2b) - the worst performance in more than a decade. Shares rose more than five per cent, or 53.5p, to 1021p.
Elsewhere in the sector, there was also a rise for Antofagasta despite its own set of grim results. Underlying earnings for the first half fell 48.6 per cent to $562m (£356m). Shares rose almost nine per cent or 46.5p to 579.5p.
More Than insurer RSA Insurance was another big riser, adding four per cent or 19.5p to 514.5p, after it said it was willing to back a £5.6bn takeover by Swiss rival Zurich following a proposed offer at 550p a share.
The biggest risers in the FTSE 100 Index were Antofagasta up 46.5p at 579.5p, London Stock Exchange up 165p at 2536p, St James's Place up 55p at 914p and Barratt Developments 34p at 624p.
There were only three fallers in the FTSE 100 Index, which were Randgold Resources down 147p at 4001p, Fresnillo down 4.5p at 639.5p, and Royal Mail down 1.3p at 459.2p.
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