Britain's benchmark FTSE 100 index closed at a fresh four-year high on Wednesday, powered by soaring miners tracking record copper prices, but catering firm Compass slumped 11.5 percent after warning on profit.
Miners Anglo American, Rio Tinto and Xstrata, put on nearly 4 percent each as copper hit a record high amid tight supply. Gains in the sector were given extra snap as the miners rallied from falls during the previous session, with Anglo particularly hard hit on Tuesday by cooling gold prices.
But the day's biggest gain was seen in the banking sector, with Asia-focused group Standard Chartered up 4.2 percent as buyers reacted to buoyant stock markets in Asia. Dealers added that vague bid talk was helping the rise, but Standard declined to comment.
The FTSE 100 index closed up 47.5 points or 0.9 percent, at the day's peak of 5,494.8, its highest reading since August 2001 and up 3.7 percent since the beginning of the month.
Andrew Bell, European Strategist at Carr Sheppards Crosthwaite, took a cautious view, even though markets remained bullish, as he anticipated consolidation after recent share market gains, and advocated a pause to assess the longer term impact of higher oil prices.
"The market's mood is that the economic outlook is probably going to continue to muddle through; that we've been through the worst that we're going to go through on the oil price, and equity markets are not that expensive," said Bell.
But share markets are likely to continue to look attractive compared to other asset classes as long as earnings grow.
"If earnings are continuing to grow, even if it's by a small amount, and the alternative is to stick money on deposit at 2 to 4 percent or in government bonds yielding 3 or 4 percent, the bar is set quite low," he added.
Catering group Compass, active on Tuesday on bid speculation, took a beating after it said annual profits would be below forecasts and its chief executive Mike Bailey was to quit next year.
The group, which said it would sell its SSP travel concessions business, said trading in Britain remained subdued, exacerbated by the July bombings in London.
Some shares were left behind in the rally, with AstraZeneca down 1.1 percent after the firm said a rival company had applied to the US to launch a generic version of its schizophrenia treatment.
Midcap drug delivery firm Skyepharma slumped 20.3 percent after announcing a 35 million pound deeply discounted rights issue to fund final stage clinical trials for its biggest drug hope, Flutiform for asthma.
The flow of trading updates from midcaps produced some mixed outcomes, with engineering group Charter up 15.3 percent after it raised its earnings outlook for the full year.
Radio firm GCap Media soared 14 percent after a trading statement pointed to extra cost savings from its founding merger earlier this year, but music retailer HMV lost 11.8 percent after reporting disappointing sales, and Brit Insurance lost 6 percent after it said US hurricanes would batter first-half profit.
A CBI survey showing retail sales volumes falling at their fastest rate in at least 22 years reminded markets of the fragility of the consumer sector, with clothing chain Next down 0.3 percent and supermarkets giant Tesco down 0.4 percent.
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