London shares recovered on Thursday as IMI surged after the engineering company's first half results.

The benchmark FTSE 100 index ended the day up 56.03 points or 0.88 percent at 6,488.88 points.

Investors welcomed news that business activity in the eurozone, Britain's main export market, picked up sharply in August, hitting a 26-month high point as the economy climbed out of a record recession.

The Composite Purchasing Managers' Index compiled by Markit Economics jumped to 51.7 points for August from 50.5 in July, pushing further beyond the 50-points boom-or-bust line.

"The eurozone manufacturing PMIs are giving markets a real boost," said Alpari trader Craig Erlam.

Markit said its separate PMI for the services sector -- which accounts for the bulk of economic activity -- rose to 51 in August for a 24-month high. The manufacturing sector PMI hit a 26-month peak at 51.3 points.

"We saw a significant improvement in the data in the second quarter, which resulted in some much improved GDP figures, and this appears to have carried over into the third as well," added Erlam.

Sentiment was also lifted as HSBC's preliminary purchasing managers' index (PMI) showed growth in Chinese manufacturing for the first time in four years this month.

HSBC said its PMI came in at 50.1 in August, compared with a final reading of 47.7 in July.

IMI climbed 5.82 percent to 1,491 pence as it unveiled a modest increase in pretax profit and increased the interim dividend by 8 percent to 12.8 pence.

"We continue to anticipate better trading conditions in the remainder of the year," chairman Roberto Quarta said.

Silver and gold miner Fresnillo gained 4.38 percent to 1,215 pence and resources giant Glencore Xstrata put on 2.99 percent to 313.85 pence. Plumbing and building matrials supplier Wolseley added 4.26 percent to 3,330 pence.

The few fallers were led by credit information specialist Experian, which shed 1.18 percent to 1,169 pence.

On the currency markets, sterling weakened to ??1.5597 at 5:24 pm from $1.5690 dollars on Wednesday evening and sank to 1.1670 euros from 1.1732 the previous night.