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Tullow Oil was one of the best blue-chip performers, climbing 84p to 1199p amid rising hopes that the world's biggest oil company ExxonMobil is poised to take a stake.
Exxon is tipped to buy Kosmos Energy's stake in the Jubilee field in Ghana.
Private equity-backed Kosmos jointly owns that field with Tullow and Houston-based Andarko Petroleum.
The speculators say a move by Exxon to take a stake in Tullow would increase its exposure to the multi-billion barrel reserve field.
This year's third quarter, the Footsie gave its best performance since records began in 1984 but today HSBC told clients: you ain't seen nothing yet.
The bank's equity strategist Garry Evans is a raging bull: "We expect that, for the next couple of quarters, growth will continue to surprise on the upside but rates will remain ultra-low. That is an almost perfect environment for equities".
He is forecasting another 20% to 25% rise in the index by the end of next year, taking it up to 6280 - still 670 points shy of its record high of 6950.6 achieved at the height of the dot-com boom in December 1999.
Evans says global growth has bottomed and the world equity index has risen 53% since early March.
"It is tempting to think that the good news has been fully priced in and that equity markets will struggle from now on. We disagree!"
He expects the growth to continue over the next couple of quarters and says economists and analysts are likely to raise their forecasts further.
The growth in gross domestic product and earnings they are already forecasting for next year is "extremely modest" by the standards of previous recoveries. "At the same time, monetary policy almost everywhere will remain ultra-easy," he adds.
The two UK-based companies at the top of HSBC's European conviction buy list include Legal & General, ½p firmer at 86p, expected to benefit from improving solvency and operating cash generation, and Lloyds Banking Group, 1.2p dearer at 96.2p, which still looks cheap on a price-earnings ratio of six.
Evans's forecast is in stark contrast to yesterday's warning from New York University professor, Nouriel Roubini - the man who predicted the banking collapse - who said that shares will drop in the months ahead as the gradual pace of the economic recovery fails to live up to investors' expectations.
Shares surged back above the 5000 mark in late trading yesterday, supported by evidence of a revival in the services sector.
Investors took the view that there was still value to be squeezed out this morning and continued to chase prices higher. They chose to ignore the abysmal manufacturing output numbers which ran counter to suggestions that the economy is on a recovery tack.
Instead they took their lead from the miners which continued to display a quick turn of pace.
They were chased higher on dearer raw material prices, including gold, which have been boosted by the latest sell-off in the dollar. Kazakhmys rose 74p to 1077p, Xstrata 45½p at 921p, and Antofagasta 40p at 786½p.
European Goldfields, the sixth-biggest company quoted on AIM, jumped 62½p to a year's high of 344p after receiving approval to bring two large gold mines Skouries and Olympias in North-East Greece into production.
The FTSE 100 index sported a rise of 104.13 at 5128.46. That was matched by opening gains on Wall Street this afternoon.
Despite the weakened dollar, the Dow Jones climbed 118.04 to 9717.79.
Shares of Durex condom and Scholes sandals group SSL International stood out with a jump of 9½p at 634½p.
The mutter from the gutter claims we can expect a bid soon from drugs giant GlaxoSmithKline, 17p higher at 1236½p, or Reckitt Benckiser, up 87p at 312p. But some fund managers argue that defensive stocks, such as SSL, are just undervalued.
Kitchen supplier Galiform added 3p to 76.3p. Word is, builder's merchant Travis Perkins, up 19p at 830½p, wants to buy it, including its Howden joinery.
And let's throw in Wolseley, the world's biggest plumbing equipment supplier, as a potential suitor. Its shares rose 27p to 1499p.
Gulf Keystone Petroleum ran into profit taking with the price falling 7¼p to 98¼p.
The shares were chased sharply higher yesterday as the buzz went round that GKP could soon be the target of a bid.
Now we learn the oil explorer has discovered oil at the Shaikan-1 well in Northern Iraq.
Takeover favourite Chloride dipped 8.6p to 165.2p after KBC Peel Hunt cut it from hold to sell.
