UK stocks follow Wall Street higher

The blue-chip FTSE 100 rose 1.7 per cent at the session's close and the midcap FTSE 250 added 1.7 per cent

Britain's main stock indexes jumped on Wednesday after upbeat earnings from Nike lifted Wall Street and offset worries about the British economy after data showed public borrowing hit a November record.

The blue-chip FTSE 100 rose 1.7 per cent at the session's close and the midcap FTSE 250 added 1.7 per cent. Both the indexes marked their biggest percentage gains in more than six weeks.

U.S. stocks rallied after Nike Inc reported better-than-expected quarterly results, sparking a 6.1 per cent gain in Britain's sportswear firm JD Sports Fashion.

It seems like yesterday we broke the four-day losing streak in the U.S. and that has translated into some positive sentiment into Europe as well, said Daniela Hathron, senior market analyst at Capital.com.

It's a quiet week in the market because of the holidays coming up. We are seeing potentially reduced volumes in the market, Hathron said.

Meanwhile, sterling slipped 1.0 per cent against the dollar after data showed British public borrowing hit a November record, underscoring the challenges for the UK economy.

As the UK economy heads towards a recession, the public purse could suffer a slowdown in tax revenue as businesses and consumers decelerate, which could result in higher public sector borrowing, said Victoria Scholar, head of investment at interactive investor.

Energy stocks were among the top gainers, rising 2.3 per cent as oil prices climbed more than $2 a barrel on a drawdown in U.S. crude stockpiles.

The commodity-heavy FTSE 100 has fared better than its global peers year-to-date, with the index set for gains of 1.5 per cent, while the continent-wide STOXX 600 and the S&P 500 are down 11.6 per cent and 18.5 per cent, respectively.