Britain's top share index notched up its biggest daily gain in more than three years on Tuesday, rebounding strongly after a two-week slide as resources stocks such as Antofagasta rallied on firmer commodity prices.
The FTSE 100 had fallen as much as 10 percent from April's five-year highs during a global equity sell-off sparked by inflation fears and tumbling commodity prices.
Analysts had anticipated a correction for the FTSE and other soaring stock indexes, though many were surprised by its ferocity when it came and now predict the market will regain its poise.
"I do not think we can say with certainty that it is the end, but it is the beginning of the end of the fall," said Royal Bank of Scotland market strategist Neil Parker.
The FTSE 100 closed 146 points, or 2.6 percent, higher at 5,678.7 points, its biggest one-day points rise since March 2003, its largest percentage gain since April 2003, and adding 36 billion pounds to its value.
In the sell-off, the index had slipped as low as 5,510.5 points, more than 600 points adrift of a five-year high of 6,137.1 set last month.
Only six stocks, including Marks & Spencer, Imperial Tobacco, Vodafone and BT Group, finished in the red, and the mid-cap FTSE 250 index leapt 4.6 percent to finish at 9,234.3 points.
"The markets got over-excited and over-reacted and hopefully some common sense is returning back to equity markets," RBS's Parker added. "Historical standards suggest we are talking about a relatively undervalued equity market."
The FTSE 100 is trading on a forward price-earnings ratio of 11.83, according to Reuters data.
The index shed about 9 percent in the fortnight-long slide between May 10 and May 22 to wipe out the year's gains, but Tuesday's bounce means the FTSE has now crawled back into positive territory for 2006, up 1.1 percent.
Miners - a key driving force behind the FTSE's run to multi-year highs as well as its recent lows - staged a strong comeback, with stocks such as Kazakhmys and Xstrata gaining more than 10 percent each as copper and gold prices surged higher.
Gold and copper fell 10 percent last week.
Heavyweight oil stocks boosted the index, contributing more than 40 points to the advance as crude oil prices rose above $71 a barrel, tracking the commodity recovery and after the US government predicted another rough Atlantic hurricane season.
Oil giant BP rose 4.2 percent, and Royal Dutch Shell gained 3.3 percent.
Property group British Land also stood out, with a 6.5 percent rise after it reported a higher-than-expected 32 percent increase in the overall value of its assets.
Results from directories publisher Yell Group were also well received, pushing its shares up 9 percent.
Retailer Marks & Spencer was among the few that failed to push higher, falling 3.2 percent, despite a big jump in annual pretax profits at the 122-year-old chain.
The figures were in line with the company's guidance, but hopes for better-than-expected results and a recent strong run for the stock combined to put pressure on the shares.
"People were waiting to see what the sales uplift would be from the refurbished stores, and the market got ahead of itself that those sales would be better than expected. And there are people taking profits after a strong run," one trader said.
Britain's largest ports group, Associated British Ports, was a notable riser on the mid-cap index, with a 15 percent jump after saying it had received a 2.5 billion pound revised bid proposal from a consortium led by investment bank Goldman Sachs.
Oil explorer Soco International also climbed the mid-cap leader board with a 16 percent rise following news that a new oilfield off the coast of Vietnam would start commercial production next year. Soco has a 25 percent stake in the field.