FTSE closes higher on U.S. GDP data

By Harpreet Bhal

LONDON (Reuters) - Better-than-expected economic growth from the United States and gains in banks and miners pushed the leading share index 1.1 percent higher on Thursday.

The FTSE 100 .FTSE closed up 57.30 points at 5,137.72, reversing earlier losses, as U.S. data signalled the country had come out of recession.

The index has gained 49 percent since hitting a low in March, helped by three months of consecutive gains from July to September.

"The GDP figures were actually very good. It reinforces the conviction in the global recovery and that is what the market is responding to," said Mike Lenhoff, chief strategist and head of research at Brewin Dolphin Securities.

"What it (the market) needs to see now to move materially higher is more of an indication that this can lead to a sustainable recovery," he added.

Banks were the biggest blue chip gainers, with Lloyds Banking Group (LLOY.L) up 7.5 percent as the lender confirmed it was considering raising capital via a rights issue and debt swap as an alternative to a costly government scheme to insure it against credit losses.

The bank said it was in "advanced discussions" with the government and regulators over its potential capital raising which could help plug a capital gap of more than 20 billion pounds.

Part-nationalised peer Royal Bank of Scotland (RBS.L), also thought to be looking at plans to reduce its exposure to the government's asset protection scheme, was up 9.5 percent, while Barclays (BARC.L) and HSBC (HSBA.L) put on 3.5 and 1.4 percent respectively.