FTSE bounces back on optimism

Britain's top shares rose on Monday, recovering after last week's steep falls, on optimism for a deal in Washington to avoid imminent contractionary spending cuts and tax rises.

On Friday, leaders of the US Senate and House said they would be flexible in efforts to settle fiscal policy differences, fuelling a late rally on Wall Street.

Over the weekend, leading US lawmakers also expressed confidence that a deal would be reached to avert the $600 billion “fiscal cliff”.

The FTSE 100 index was up 46.65 points, or 0.8 percent, at 5,652.24 by 10:08 SA time, having dropped 1.3 percent on Friday, taking its weekly losses to 2.8 percent - the steepest since May.

Economically-sensitive commodity stocks and banks spearheaded the rebound on Monday. - Reuters