The biggest jump in employment since the financial crisis bolstered investors' nerves ahead of a key announcement by the US Federal Reserve this evening.
Having fallen for most of the past six weeks the FTSE 100 gained 19.5 points or 0.3% to 6,505 as investors bet that the US central bank would not announce the start of the withdrawal of its stock market friendly, stimulus polices.
This is despite a swathe of evidence that the US economy is probably sufficiently robust to grow without the Fed's support. However, the consensus is that Janet Yellen, the incoming chair of the Federal Reserve, will begin to 'taper' the third round of quantitative easing by March at the latest.
This is highly significant as it is the monthly $85 billion dollar 'printing' that has helped rally stock markets in the past sixteen months.
Traders set aside their nerves as official UK figures showed 250,000 new jobs were created in the three months to the end of October, way ahead of expectations, confirming the strength of the country's economic recovery.
European markets also advanced, the FTSE Eurofirst index up 12.4 points or 1% to 1,260.5 after the Ifo survey recorded a high level of confidence by businesses in Germany.
In London Centrica (CNA.L) led the main index higher, up 3.4% or 11p to 334p, after the energy company said it would sell its Texas gas power stations and use the cash to extend its share buyback programme.
Marks & Spencer (MKS.L) and J Sainsbury (SBRY.L) fell 3% and 2.7% in response to growing concerns at the weak Christmas sales. Analysts at UBS downgraded Marks & Spencer to 'neutral' from 'buy' after forecasting a fall in margins.
Elsewhere Ophir Energy (OPHR.L) gained 8.4p or 2.75% to 314.4p after striking a farm-out deal with Austria's OMV over deep water exploration in Gabon.
Barratt Developments (BDEV.L) added 2.5p or 0.75% to 338.5p after forging a new joint venture with social housing provider London and Quadrant.
Economists were impressed with the employment figures, with the level of new jobs beating forecasts of 165,000 new vacancies. This lowered the unemployment rate to 7.4% from 7.6%, closer to the 7% threshold that Bank of England governor Mark Carney has set as one of the conditions for considering a rise in interest rates.
Azad Zangana, European economist at Schroders, said: 'The boost in employment should continue to drive the economy into 2014. The only thing missing from the chancellor’s wish list is a rise in real wages. The fall in the unemployment rate will also put the Bank of England under pressure, as it has promised to consider raising interest rates when the unemployment rate falls to its 7% threshold. This is clearly coming sooner than expected, and is now being reflected by markets.'