The FTSE 100 has closed at its highest for 12 years as investors seek better returns on shares than they can get on bonds and other savings.
The British Broadcasting Corporation reports that the index ended 32 points up at 6,756, the best finish since September 2000 and not too far behind the all-time high of 6,930 reached in December 1999.
Banks were big gainers, with RBS up by 4.5 per cent after a broker upgrade. Easyjet rose by four per cent, and BT was 2.6 per cent higher.
In the FTSE 250, bus firm First Group fell by 30 per cent after axing its dividend.
The FTSE 100 has been reaching fresh highs on the back of money-printing measures by central banks, including the Bank of England, which have cut the price of government debt and sent equities rocketing.
On Wall Street, the Dow Jones and the S&P 500 have been reaching levels not seen for years.
Jawaid Afsar, a sales trader at Securequity, said the FTSE 100 keeps “grinding higher, and there’s no real selling pressure”.
He added, “Everyone keeps trying to call the top of the market but any wobble is another occasion to buy into it. The momentum is still bullish.”
Other risers included United Utilities, up by 2.5 per cent, after an upgrade of the sector by Goldman Sachs and recent excitement surrounding the overseas bid interest in rival Severn Trent.