THE FTSE 100 followed global stocks higher as investors breathed a sigh of relief over easing tensions between the US and North Korea.
London's blue chip index ended the day higher by 0.67 per cent or 49.18 points at 7433.03, while the French Cac 40 and German Dax rose 0.71 per cent each.
Investors had been spooked in recent weeks amid a rising possibility of potential US military action against North Korea over its missile threats on Guam.
But jitters eased following reports that North Korean leader Kim Jong Un said he will monitor US conduct more closely before deciding whether to order a missile test.
Mr Trump took to Twitter on Wednesday to praise the leader's decision, saying: "Kim Jong Un of North Korea made a very wise and well reasoned decision. The alternative would have been both catastrophic and unacceptable!"
David Madden, a market analyst at CMC Markets, said: "The upward move in stocks has been attributed to the easing of political tensions between the US and North Korea.
"We have recouped a lot of the ground that was lost because of the tensions that escalated last week, but we have not fully recovered."
In currency markets, the pound was trading nearly 0.1 per cent lower against the US dollar at 1.285, but was up 0.2 per cent versus the euro at 1.09.
The eurozone currency was losing ground amid reports that European Central Bank president Mario Draghi would not be discussing the bank's monetary policy at the US Federal Reserve's Jackson Hole conference next week.
In oil markets, Brent crude prices were down 0.5 per cent at $50.65 per barrel after Energy Information Administration data pointed to rising gas stockpiles, suggesting lower energy demand.
In UK stocks, BHP Billiton rose 26p to 1,368p after hedge fund and activist investor Elliott Advisors announced it had increased its stake in the company five per cent in a bid to keep the commodities giant "accountable for delivering results".
The move will give Elliott the right to call for general meetings and put forward shareholder resolutions.
Construction firm Balfour Beatty jumped 16.7p to 279.2p after swinging to a pre-tax half-year profit of £12 million, compared with a £15m loss in the same period a year earlier, as the company continued with its turnaround plan.
Car insurer Admiral tumbled 131p to 2,047p as investors lamented sluggish bottom-line growth, after pre-tax profits rose two per cent to £193m in the six months to June 30. Turnover rose 15 per cent to £1.45 billion over the same period.
The biggest risers were Glencore up 14p to 345.25p, Anglo American up 45p to 1,286.5p, Old Mutual up 6.7p at 208.7p, and Sage Group up 21p at 704p.
The biggest fallers were Admiral Group down 131p at 2,047p, Direct Line Insurance Group down 9.4p at 386.3p, Severn Trent down 22p at 2,247p, and United Utilities Group down 8.5p at 909.5p.
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