Britain's blue chips finished 1.21% higher, erasing yesterday's losses and after the Queens Speech, which was broadly welcomed by the UK's business community.
Sentiment was also boosted in all likelihood as it emerged a new agreement had been reached over Greece's debt in Brussels, according to a Greek official, although no final paperwork had been drawn up.
FTSE100 finished the session 84.34 points higher at 7,033, with insurer Beazley (LON:BEZ) among the biggest gainers, up 6.85% to 302.5p. Hiscox (LON:HSX) was also up - 3.49% to 861p- as JP Morgan Cazenove were both upgraded to ‘overweight’.
Yesterday, Footsie shed more than 82 points, or 1.18%, to close at 6,948.
Fags maker Imperial Tobacco (LON:IMT) was also burning brightly after it agreed to buy Reynolds American's Winston, Kool, Salem and Maverick brands. Shares added 3.32% to 3,393p.
In Westminster, the Queen’s Speech included moves to cut small business regulation, set up an arbitration service to settle disputes between big and small companies, and to streamline business rates.
A National Insurance Contributions & Finance Bill featured plans to block any rises in income tax, VAT or NI before 2020 and to raise the threshold above which people pay income tax to £12,500.
Plans to allow 1.3mln housing association tenants to buy their homes cheaply are also in a new housing bill. There will be help for first-time buyers, with 200,000 starter homes for under-40s at a 20% discount, but it was unclear if they would be on top of those already planned.
House builders Bovis (LON:BVS), Barratt (LON:BDEV) and Persimon (LON:PSN) all gained today.
Elsewhere, Irish building materials firm CRH (LON:CRH) confirmed after the market closed yesterday it has closed the deal with Lafarge and Holcim to buy some of their assets, subject to the merger between the two European cement giants going ahead.
CRH added 3.55% to 1,839p while sector peers such as Ashtead Group (LON:AHT), up 2.79%, Travis Perkins (LON:TPK), up 1.55%, and Wolseley (LON:WOS), up 2.2%, rose in sympathy.
Meanwhile, Synergy Healthcare (LON:SYR) dropped almost 16% to 1,822p as there were concerns that the proposed takeover of the company by US group Steris may be blocked by the US Federal Trade Commission.
Engineering company Weir Group (LON:WEI) also fell after a downgrade from Deutsche Bank.
The broker dropped its ‘buy’ rating to a ‘hold’ after the company made its biggest gain in more than a month. Shares slipped 0.7% on the day to 1,988p.
Brewin Dolphin (LON:BRW) fell 10.71% following its mixed bag of a trading update. Funds under management have risen this year but commissions are down as trading volumes through the Scottish stockbroker have fallen.
In small caps, Forbidden Technologies (LON:FBT) was a big winner, adding 23.81% to 9.75p, while Secure Property (LON:SPDI) shot up 25.45% as the south-east Europe-focused property and investment company revealed underlying earnings (EBITDA) quadrupled in 2014.
Shares in Lansdowne Oil (LON:LOGP) fell 20.31% to 6.38p as it said there had been no development on the farm-out process for the Barryroe asset off the coast of Ireland, in which Lansdowne holds a 20% interest.
Vast Resources (LON:VAST), formerly African Consolidated, added 23.53% to 1.05p