The UK markets rallied strongly on Monday, driven by strong manufacturing figures out of the UK, the US and China. The FTSE 100 closed up 1.9%, or 106 points, at 5875 and the mid-cap index was up 1%, or 116 points, at 11,655.
Traders said good data out of China helped drive the miners higher. That lifted the indices, as they are so heavily exposed to mining stocks.
Chinese manufacturing data came in well above forecasts, calming fears of a sharp slowdown in the country's economic growth. The government said on Sunday that the PMI jumped to 53.1 in March, hitting an 11-month high, as surprisingly strong demand boosted new orders for factories.
Mining giant Rio Tinto closed up 3.3% at £35.60, while silver miner Fresnillo rose 3.4% at £16.52.
Paul Kavanagh of Killik & Co said traders were also cheered by UK manufacturing data that suggest Britain will avoid a double-dip recession.
It's the first day of the trading quarter, so there is plenty of activity going on. It felt like it was going to go better this morning, everyone was ready to go.
But the market stalled in early trade, dragged lower by the banks. Traders were worried about a story that the Bundesbank would not accept certain bonds as collateral, which could drive wholesale funding costs higher.
Kavanagh said: "That took some of the stuffing out of [the market]". But once the German central bank quashed those rumours, "it got back into its stride and it just kept going".
