British shares clawed back losses on Wednesday to end the year's first trading day on a positive note after a disastrous 2018, helped by investor appetite for stocks deemed less risky and also by a comeback for oil majors despite weak data from China.
London's blue-chip bourse ended 0.1 percent higher while the mid-cap index was up 0.5 percent after steep losses earlier on Wednesday.
The indexes teetered as trading volumes remained roughly around two-thirds of their 90-day average during the session, after recording their worst yearly drop since the 2008 financial crisis last year.
Heavyweights BP and Shell advanced 2.3 percent and 1.4 percent, respectively, as crude prices erased earlier losses to trade in the black.
Investors also took some notice of the positive domestic PMI data prompted by Brexit-induced stockpiling, although uninspiring Chinese data had sparked a global sell-off earlier and raised questions about the global economy.
"Although stockpiling played a role in the strong UK PMI data, it was still the best economic news out there today," said Jasper Lawler, head of research at London Capital Group.
Defensive stocks - considered less risky - also offered support to the main index, with shares in telecommunication firms, healthcare companies and utilities all gaining.
GLOBAL WORRIES
Manufacturing activity in China, the world's second-largest economy, contracted for the first time in 19 months amid its trade spat with the United States. That comes on the heels of a poor official survey on factory output on Monday.
US manufacturing activity also fell, data showed, while that in the euro zone barely expanded in December.
Continued fears of a global cyclical downturn will likely cap the upside for blue-chip British shares, said CMC Markets analyst Margaret Yang.
"A string of missing PMIs from China's official and private sector suggest that Asia's largest economy is still cooling off due to weaker external demand and trade uncertainties," Yang said.
"It is still too early to say markets have bottomed out yet."
A drop in sterling, with strong factory surveys failing to dispel growing anxiety over the Brexit negotiations, lifted the shares of companies that book in revenue from the United States.
Pharmaceutical giants GlaxoSmithKline and AstraZeneca pushed out modest gains while consumer giant Unilever rose 0.8 percent.
Financial heavyweights Prudential and Lloyds fell nearly 2 percent each.
Investors also shunned miners due to the concerns over growth in China, which is the world's top metals consumer, and instead turned to safe haven commodities. Gold prices rose to a more than six-month peak as a result, pushing Fresnillo 3.3 percent higher.
Glencore, Antofagasta, BHP, Anglo American and Rio Tinto edged 1.1-3 percent lower.
High street retailer Next Plc was up 4.7 percent, top of the blue-chips, ahead of its Christmas trading update due on Thursday.
John Lewis' higher sales in the week ending Dec. 29 was a ray of sunshine for a retail sector buffeted by competition from Amazon, by Brexit jitters, lower consumer spending and rising labour costs.
John Lewis, which is Britain's biggest department stores operator and the first retailer to update on trading at year-end, said demand had been "very strong" on Christmas Eve.
Medical products maker Smith & Nephew tumbled 2.4 percent, with traders citing a rating cut by brokerage JPMorgan.
Elsewhere in corporate news, Ophir Energy soared nearly 30 percent to the top of the small-cap index after the oil and gas producer said it was in takeover talks.
Real estate investment trust Hammerson fell 2.1 percent as it said its share buyback program will be paused ahead of the release of 2018 results.
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