Dow up almost 60 points

Hopes that politicians will make further progress tackling the eurozone debt crisis this week saw world markets make cautious gains today.

The FTSE 100 Index rose 59.4 points to 5548.1 after traders were encouraged by reports that European leaders agreed a plan to recapitalise the region's banks.

But key decisions about increasing the size of the €440bn bail-out fund and restructuring Greek debts are still to be taken on Wednesday.

London's leading shares lost earlier gains to slip into negative territory before the rally gathered momentum in late trading.

The pound was down against the euro at 1.15 after the single currency was boosted by optimism about the rescue package. But sterling was up at 1.60 against the dollar.

Markets were boosted by a strong opening of the Dow Jones Industrial Average in the US, which was up nearly 1% and by better than expected manufacturing data in China.

Banks were among the biggest risers, with Lloyds Banking Group up 5% or 1.7p at 34.6p, while Royal Bank of Scotland rose by 0.5p at 25p and HSBC gained 12p at 530p.

Miners were also ahead, with copper giant Antofagasta up more than 7% or 82p at 1178p as the price of the precious metal surged.

Bleak data showing that manufacturing and services sectors in the eurozone saw their biggest decline in October since July 2009 failed to dent hope that politicians would hammer out a rescue package.

The Markit eurozone composite output index, where a reading below 50 indicates contraction, dropped to 47.2 from 49.1 in September, with signs of both the French and German economies slowing down.

The oil and gas sector was down ahead of results from BP, BG Group and Royal Dutch Shell.

A note from Nomura said oil companies were set to continue to outperform the market after benefiting from high oil prices, but Shell fell 11p at 2303p, while BP was down 1.3p at 438.1p.

Meanwhile, prisons and security group G4S rallied despite a governance body that advises 1,700 large investors expressing concern about the risks of its "monster" £5.2bn (€5.96bn) takeover deal for Danish cleaning and services firm ISS.

Institutional Shareholder Services said the acquisition is a departure from the strategy set out by G4S's chief executive Nick Buckles. Shares were up 1.2p at 243.5p.

Outside the top flight, shares in own-label household goods maker McBride were up 8% after the company said revenues rose by 2% in the three months to October 23 despite having to fight off strong promotions from branded rivals. Shares rose 9.5p to 126.8p.

The biggest Footsie risers were Kazakhmys up 68.5p at 925p, Lonmin ahead 79p at 1112p, or Antofagasta up 82p at 1178p and Rio Tinto ahead 222.5p at 3373.5p.

The biggest Footsie fallers were BG Group down 27.5p at 1327p, International Power off 5.6p at 329.3p, and National Grid down 6.5p at 629.5p, and British American Tobacco off 27.5p at 2852.5p.