FTSE 100 index rallies 3.2 percent, back above 5,100

Financeroll – Rallies by hard-pressed banks, insurers and commodity stocks led a bounce back by Britain's top shares Wednesday as support for debt-laden Greece revived investor appetite for riskier assets. Financial issues were boosted after the International Monetary Fund said it "definitely participate" in a second bailout package for Greece if the Washington-based lender was happy about the country's determination to solve its debt problems.     

That news followed Tuesday's announcement that European finance ministers had agreed to safeguard their lenders and a pledge to protect Franco-Belgian lender Dexia following concerns over its exposure to the Greek debt crisis.    Barclays saw the biggest gains in the UK banks sector, up 7.7 percent, while life insurers Aviva and Legal & General also stood out out, ahead 7.4 and 6.8 percent respectively reflecting an easing in bond market exposure worries as well as a rise in their equity assets.    

At the close, the FTSE 100 index was up 157.73 points, or 3.2 percent at 5,102.17. The index had shed a similar mount over the previous two sessions. Integrated oil & gas was the best performing blue chip sector, led by BP up 4.9 percent, as the crude price CLc1 recovered after recent falls. Specialty miners also found support, helped by a rally in the copper price , with India-focused Vedanta Resources the top FTSE 100 gainer, up 8.5 percent ahead
of second-quarter results due on Friday.

U.S. bluechips were 0.5 percent higher by London's  close, helped by some positive data, with the ISM services reading much as expected, showing a modest slowdown, while the ADP private employment report came in better than expected. Building supplies firm Wolseley , which is heavily exposed to the U.S. recovery via the housing market, was also a top FTSE 100 gainer, up 8.2 percent, having fallen on Tuesday after a weak outlook statement.    

There were mixed messages on the UK economy as the PMI services number surprised on the upside, but the final reading for British second-quarter growth was less than expected. British retailers, however, missed out on the rally on Wednesday as downbeat updates from several in the sector provided a stark reminder of the challenges on the high street.    

Tesco , the world's third biggest retailer, posted one of its biggest-ever falls in underlying sales, while rival J Sainsbury saw only modest growth.   
On the second-line, Mothercare plunged more than 40 percent after warning its full-year results would be hit by deteriorating UK sales as British consumers reined in spending.    ext and Marks & Spencer were big blue chip fallers, off 2.3 percent and 1.3 percent respectively.