Miner Centamin led the risers, up four per cent in early trading, as investors reacted positively to news of a record amount of gold it produced in its Egyptian mine over the second quarter.
Oil and gas explorer Ophir Energy was up by 3.91 per cent, and Melrose Resources by 3.14 per cent, on news of its merger with Petroceltic.
UK financials made a strong start to the day. Barclays showed early gains of 2.5 per cent, and Lloyds added 2.32 per cent. HSBC was up by a modest 0.29 per cent and RBS was up by 1.36 per cent.
Platinum producer Lonmin was the biggest faller, dipping 6.17 per cent in early trading. It emerged last night that violence at the firm’s Marikana mine in South Africa had reached critical levels, as 18 people were reported dead.
Home shopping and education supplies group Findel was an early decliner, losing 4.44 per cent, followed closely by intellectual property firm IP Group, which shed 3.38 per cent.
Britain’s biggest pub operator, Punch Taverns, also showed a dip in early trading, down by 5.6 per cent.
In Asia, the Nikkei closed at its highest level in three months, as investors were heartened by Merkel’s comments, while the Hang Seng was up 0.77 per cent in trading.
Over in the US, the Dow Jones closed 0.65 per cent up yesterday.