At the close of play, the FTSE100 was up 51.6 points at 5,245.73 with the FTSE250 ahead 151.02 points at 9,031.54 and the FTSE Smallcaps 17.01 points better at 2,730.32.

NEW YORK

US stocks were down sharply as traders returned from Thanksgiving to face the fallout from news of Dubai debt problems.

As London closed, the Dow Jones Industrial was down 140 points at 10,324, with the S&P500 off 15 points at 1,096 and the Nasdaq Composite 25 points lower at to 2,151.

LONDON MARKETS

Morning trade in London was dominated by the Dubai debt crisis, with financial issues under early pressure as exposure to Dubai World was scrutinised. However, as the session progressed, banks and miners staged a strong recovery and traders looked for bargains after yesterday's heavy losses.

Among the banks today, Royal Bank of Scotland overcame an early downturn after revealing it has now signed up to the Government's Asset Protection Scheme. The group has signed an acquisition and contingent capital agreement under which it has agreed to issue £25.5bn of new capital to the Treasury, lifting Government ownership to around 84%. RBS shares added 1.73p at 34.73p, heading the leaderboard.

Barclays recovered to trade 6.75p higher at 297.85p, HSBC ticked up 0.7p at 706.3p and Standard Chartered gained 6p at 1,520p.

Lloyds Banking Group shares traded ex-rights today, standing at 58.6p by the close.

Insurers made progress on the back of upbeat broker comment, with Legal & General up 2.45p at 80.95p when Nomura raised its target on the stock to 125p from 115p. Aviva added 8.1p at 379.5p and Prudential rose 185p at 639p.

Phone dealer Carphone Warehouse ticked up 2.4p at 194.7p after raising its full-year guidance when it posted half-year results ahead of expectations.

Commodity issues followed the banks' example by gaining momentum as the session wore on.

Fresnillo was the only faller amongst the miners, down 7p at 845.5p, while Xstrata was the best of them, up 50p at 1,072p.

Anglo American rose 25p at 2,588p, Vedanta advanced 69p at 2,305p and Randgold Resources gained 140p at 5,165p.

Oil majors shrugged off weakening crude prices, with Shell up 17p at 1,769p, BG Group 18.5p higher at 1,126p and BP ahead 9.8p at 583.8p.

Down the list, Dana Petroleum made strong gains, up 24p at 1,230p, helped by a positive take on the shares in the Daily Telegraph this morning.

A review of retailers by Goldman Sachs created movement, with luxury brand Burberry ahead 9.5p at 572.5p after an upgrade and Home Retail Group and Kesa Electricals falling 2.2p at 298.4p and 2.1p at 154.8p on being downgraded to sell.

Hopes of strong trade over the holiday period gave travel firms a boost, with Thomas Cook the best performer, up 9.7p at 216.2p and TUI Travel ahead 5.7p at 243.7p. Cruise operator Carnival rose 47p at 2,042p.

Activity holiday specialist Holidaybreak jumped 12.25p at 260p when news that its Education arm was buoyant outweighed a slump in full-year profits.

Story provided by Business Financial Newswire