The blue chip FTSE 100 index ended up 0.7 percent, slightly outperforming the broader European market.

Royal Mail was the biggest faller, slipping 7 percent after its first-half profit dropped despite stronger performance in Europe.

The group also plans to cut more costs in order to gain a larger share of the parcels market.

"There were no London property disposals ... and letter weakness still needs to be offset with growth in the highly competitive parcels arena," Mike van Dulken, head of research at Accendo Markets, said in a note.

The rally was broad-based among the top gainers, with Carnival, Mondi and housebuilder Barratt Developments gaining between 1.7 and 3.5 percent.

Barratt Developments rebounded after dropping 2.8 percent in the previous session following a disappointing update.

"I think there's some bargains to be had at this point in time for some stocks that, over the last six weeks, have taken a bit of a hit, are now offering quite good value and are also in oversold territory," said Jonathan Roy, advisory investment manager at Charles Hanover Investments.

"We've had Brexit and the U.S. elections, so people have been cautious, they've been sitting on cash. Now, there's a little bit more impetus to put that back into the market."

Mining stocks provided the biggest support to the blue chip index, with Anglo American and BHP Billiton up 2.9 percent and 1.8 percent respectively.

The mid cap index also rose, gaining 0.7 percent on the back of jumps in Hill & Smith and in Investec, after both companies reported well-received updates.

Hill & Smith, an infrastructure products firm, rose 3.4 percent after hitting a record high.

"Another solid trading update with FY16 expected to be at the top of market expectations with positive momentum in most divisions supplemented by FX tailwinds. UK Roads and Galvanising are again the key performers," analysts at Jefferies said in a note.

(Reporting by Kit Rees; Editing by Kevin Liffey)

By Kit Rees