Miners and banks lift FTSE 1.4 percent

By Jon Hopkins

LONDON (Reuters) - Leading shares ended 1.4 percent higher on Wednesday boosted by a rebound from miners and banks, with retailers Next NXY.L and Marks & Spencer (MKS.L) also higher after posting forecast-beating figures.

At the close, the FTSE 100 .FTSE was up 70.68 points at 5,107.89, recouping all of Tuesday's losses when the index fell 1.3 percent to its lowest closing level in a month.

"Tuesday's fall looked to have been overdone, and shares have bounced back but confidence remains fragile ahead of tonight's news from the Fed and the BoE's pronouncements tomorrow," said Mic Mills, senior trader at ETX Capital.

A rebound by mining stocks added the most weight to the blue chip rally, reflecting a rise in metal prices on the back of a weaker dollar ahead of the Federal Reserve's statement on interest rates and the economy, due at 7:15 p.m..

Fresnillo (FRES.L), Kazakhmys (KAZ.L), Antofagasta (ANTO.L), Xstrata (XTA.L), BHP Billiton (BLT.L) and Vedanta Resources (VED.L) were up 3.3 to 9.2 percent.

Banks recovered from Tuesday's sharp falls as investors re-evaluated the outlook for the sector following the 31 billion pounds in funding from the government agreed for Lloyds Banking Group (LLOY.L) and Royal Bank of Scotland (RBS.L)

RBS added 1.5 percent, while Barclays (BARC.L), HSBC (HSBA.L) and Standard Chartered (STAN.L) gained 1.4 to 4.2 percent. But Lloyds shed 1.2 percent as its record 13.5 billion pounds rights issue weighed on it.

Wall Street posted strong gains in early trade on Tuesday, with U.S. blue chips .DJI up 1.2 percent by London's close awaiting the Fed statement, and after the U.S. Institute of Supply Management said activity in the service sector grew for a second consecutive month.