The FTSE-100 index surged to its highest close for more than 12 years as free-spending central banks continue to send investors flocking to shares.
The London market closed up 32.57 points at 6755.63, a 0.5% gain and its highest finish since September 2000 when the dotcom boom was in full swing.
Stimulus drives by central banks, including major money-printing exercises by the Bank of England, the US Federal Reserve and the Bank of Japan, have cut the price of government debt and sent equities rocketing.
On Wall Street, the Dow Jones industrial average was up in early trade, while the Dax in Frankfurt and the Cac 40 in Paris both advanced. Sterling also made ground on money markets, with £1 up to $1.52 and €1.18.
The London market shook off losses in the heavily weighted mining sector. Royal Bank of Scotland led the Footsie's charge, gaining 4.5%, or 15.1p, to close at 351.9p, on the back of an upgrade by Numis Securities.
However, investor pessimism over the outlook for gold was reflected in a number of share prices, with Fresnillo, down 35p to 1034p, and Randgold Resources, down 61p to 4696p.
Bullion has lost its appeal as the US dollar rises on expectations that policymakers will bring the curtain down on the country's quantitative easing programme as economic fortunes improve.
After falling for seven sessions in a row, gold recovered slightly to stand at about $1364 an ounce.
Footsie newcomer easyJet was near the top of the risers board as investors took encouragement from the performance of Ryanair in the face of tough economic conditions. The Dublin-based rival reported a 13% rise in post-tax profits and said it expected further growth in the current year. EasyJet shares, which have already risen by more than 50% this year, were up by 47p to 1235p.
Other risers included United Utilities after an upgrade of the sector by Goldman Sachs and recent excitement surrounding the overseas bid interest in rival Severn Trent.
United shares were 19.5p higher at 784.5p while South West Water owner Pennon flowed up 20p to 719.5p in the FTSE-250 index.
Meanwhile, shares in rail and bus operator FirstGroup dived by more than 30% after it announced plans to raise £615 million from shareholders in a rights issue and said it would axe its dividend for the next year. The company, which plans to pour £1.6 billion into a four-year investment programme, is looking to tackle debts of nearly £2bn and the fall-out from the botched bidding process for the West Coast mainline. The shares fell 68.2p to 155.6p.
The biggest risers on the Footsie were Royal Bank of Scotland, easyJet, SSE, up 44p to 1646p, and Petrofac, 36p higher at 1361p.
The biggest fallers were Fresnillo, Eurasian Natural Resources, off 7.5p to 264.1p, Polymetal International, down 16.5p to 617p, and Marks & Spencer, losing 10.5p to 440.5p.
Why are you making commenting on The Herald only available to subscribers?
It should have been a safe space for informed debate, somewhere for readers to discuss issues around the biggest stories of the day, but all too often the below the line comments on most websites have become bogged down by off-topic discussions and abuse.
heraldscotland.com is tackling this problem by allowing only subscribers to comment.
We are doing this to improve the experience for our loyal readers and we believe it will reduce the ability of trolls and troublemakers, who occasionally find their way onto our site, to abuse our journalists and readers. We also hope it will help the comments section fulfil its promise as a part of Scotland's conversation with itself.
We are lucky at The Herald. We are read by an informed, educated readership who can add their knowledge and insights to our stories.
That is invaluable.
We are making the subscriber-only change to support our valued readers, who tell us they don't want the site cluttered up with irrelevant comments, untruths and abuse.
In the past, the journalist’s job was to collect and distribute information to the audience. Technology means that readers can shape a discussion. We look forward to hearing from you on heraldscotland.com
Comments & Moderation
Readers’ comments: You are personally liable for the content of any comments you upload to this website, so please act responsibly. We do not pre-moderate or monitor readers’ comments appearing on our websites, but we do post-moderate in response to complaints we receive or otherwise when a potential problem comes to our attention. You can make a complaint by using the ‘report this post’ link . We may then apply our discretion under the user terms to amend or delete comments.
Post moderation is undertaken full-time 9am-6pm on weekdays, and on a part-time basis outwith those hours.
Read the rules hereComments are closed on this article