The FTSE 100 rose 2% at the opening of trading on Tuesday, moving into positive territory for the first time since the Brexit vote.
The gains come alongside a boost for sterling, which is up 0.4% against the dollar at 1.32, coming after the pound hit its lowest level since 1985 on Tuesday.
However, experts dubbed the increases a “dead cat bounce”.
Connor Campbell at Spreadex said: “This may well be a dead cat bounce, but one imagines given the state they are in the global markets will welcome any respite they can.
“With little data on the cards this morning – not that investors would be paying much attention if there were – the post-Brexit fallout will continue to define the day’s trading.”
The British currency and the FTSE have taken a pounding since the shock referendum result, which has led to volatility across global stock markets.
On Monday, Standard & Poor’s stripped the UK of its tripe-A credit rating following the vote.
