A programme by the European Central Bank for a year from March would amount to some 600 billion euros, based on a rate of 50 billion euros per month. If a similar plan ran until the end of 2016, it would surpass 1 trillion euros.

"The hours are being counted down to the ECB meeting (on Thursday). Apparent confirmation of the theory that QE is coming was enough to cause markets to rally," Chris Beauchamp, analyst at IG, said. "The risk of such moves is that they increase the chance of disappointment."

The market also got support from the minutes of the Jan. 7-8 meeting of the Bank of England showing two policymakers ditched their long-standing calls for an end to record-low interest rates in the face of tumbling inflation, prompting economists to again push back forecasts for a rate cut.

The benchmark FTSE 100 index <.FTSE> rose for a fifth straight session and ended 1.6 percent firmer at 6,728.04 points, the highest since early December.

The UK Oil and Gas index <.FTNMX0530>, up 2.8 percent, led the market higher after energy companies tracked a rise of 1.9 percent in oil prices . BP (>> BP plc), BG Group (>> BG Group plc) and Royal Dutch Shell rose 2.2 to 4.3 percent.

"We are witnessing a relief rally as stronger oil prices have prompted some people to build positions in energy stocks. Investors are also positioning ahead of tomorrow's likely announcement of a bond-buying programme by the European Central Bank," said Mike Jarman, chief strategist at H2O Markets.

Among the day's sharpest movers, education and media group Pearson (>> Pearson plc) was the top FTSE 100 gainer, adding 4.9 percent, after the group said it expected adjusted earnings per share of between 75 and 80 pence in 2015, up from the 66 pence it expects for last year.

British telecom firm BT Group (>> BT Group plc) rose 1.7 percent, outperforming the broader market. Traders cited a report in German Manager Magazine saying that Deutsche Telekom (>> Deutsche Telekom AG) and BT were discussing partnerships between their enterprise businesses and in procurement.

Among big fallers, Sports Direct (>> Sports Direct International Plc) slipped 5.8 percent after founder Mike Ashley cut his stake in the retailer to 55 percent. Mid-cap oil producer Afren (>> Afren Plc) fell 18.6 percent after saying it was reviewing its capital expenditure budget and talking with lenders to amend credit facilities.

(Additional reporting by Alistair Smout; Editing by Alison Williams)

By Atul Prakash