Strength in the banking sector, including Barclays following forecast-beating results, and rising utilities stocks steered Britain's leading share index back on an upward path on Thursday.
Shares in Barclays rose 2.4 percent after the bank reported earnings that beat forecasts, while the rest of the sector was on a firmer footing, with bid target Abbey National rising 1.7 percent as investors reckoned a possible counter-bid move by HBOS might spark more take-over interest.
The FTSE-100 benchmark index recouped around a quarter of Wednesday's loss, rising 5.3 points to 4,413.4, although a weak Wall Street showing took the shine off an earlier rise to 4,432.5 points.
The FTSE took a widely expected quarter-point rise in UK interest rates in its stride.
"We've had some good results from quite a broad range of companies, and that's enough to support the market," said Andrew Hobson a fund manager at Exeter Asset Management. "But I can't see it really pushing the market higher. I think it will still remain concerned about the oil price for some time."
Strength in utilities helped keep the market in positive territory, with shares in United Utilities up 2.5 percent after a mixed review from water regulator, Ofwat, was taken positively by the market.
Water firms were offered the right to raise household water bills by 13 percent over the next five years, less than half the increase the companies wanted, but the regulator said capital spending did not need to be as high as was expected.
Services firm Rentokil was the biggest blue chip gainer, up 4.2 percent, with dealers citing institutional buying and a return of persistent take-over or break-up speculation.
But shares in Smith & Nephew sank 10 percent after it missed forecasts for second-quarter earnings.
"When there are bad results there's a big overreaction at the moment," said Martin Dobson, senior dealer at brokers Hoodless Brennan.
Among mid-caps, shares in asset management firm Singer & Friedlander rose 5.2 percent, buoyed by persistent market speculation that Icelandic bank Kaupthing or an Icelandic investment company may increase their stakes or make a full bid for the company, dealers said.
Telecoms-equipment testing firm Spirent grabbed back Wednesday's 9.5 percent fall to clock up a 16 percent gain after the company announced a return to first-half profit and said it was on course for the full year.
But shares in online retailer Lastminute.com reversed an earlier rise to drop 15 percent after stockbroker Cazenove placed around 18 million shares in the company at 95 pence. Dealers also cited a lack of clear guidance on costs for this year at a company presentation to analysts.
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