By Michael Taylor

LONDON (Reuters) - The blue-chip index reversed initial losses to rise more than 1 percent on Wednesday as commodities tracked energy and metal prices higher, while banks also rose as strong U.S. data pushed stocks positive.

The FTSE 100 .FTSE ended up 57.4 points, or 1.1 percent at 5,528.1 after falling to 5,434.7 earlier in the session.

Across the Atlantic, U.S. stocks rose to boost UK sentiment after data showed that new orders for long-lasting U.S. manufactured goods jumped a surprising 1.3 percent in July on strong civilian aircraft sales, while a gauge of business investment also rose unexpectedly.

The UK's benchmark share index, is still down about 14 percent this year, however, on fears of a recession, concerns over rising commodity prices and the impact of a global credit crunch.

The FTSEurofirst 300 of top European shares was 0.2 percent higher.

Among leading sectors, heavyweight oil shares were in demand as crude prices traded above $118 a barrel and after oil explorer Tullow Oil (TLW.L: Quote, Profile, Research) reported an almost 250 percent rise in first-half net profit, beating analysts' forecasts, thanks to high oil prices and the sale of a North Sea field.

Tullow Oil added 3 percent.

Oil and gas services firm Petrofac (PFC.L: Quote, Profile, Research) also reported better-than-expected first-half net profit, up 57 percent from a year ago, and its shares rose 6.2 percent.