BANKS helped pull the London market higher today after eurozone debt fears were eased when France escaped a credit rating downgrade.

Ratings agency Fitch said it had no plans to slash France’s AAA rating, although the news was tempered by a warning that Italy could suffer a downgrade this month.

The FTSE 100 Index closed 84.4 points or 1.5% higher at 5696.7,  with Barclays up 6% or 10.2p at 188.3p, Royal Bank of Scotland ahead 1.1p at 21.1p and Lloyds 1.1p higher at 27.3p.

Sentiment was also helped after Greece successfully raised 1.6 billion euros (£1.3 billion) in the sale of 26-week treasury bills at a lower interest rate than a similar auction last month.

Ironically, weakening import data from China also served to boost the market. Heavily-weighted mining stocks soared amid mounting speculation the nation’s Central Bank would move to stimulate economic activity. Kazakhmys was the biggest riser, ahead 58p, or 6%, at 1037p, while Fresnillo was up 94p at 1732p.

Other markets also made strong gains with Germany’s Dax and France’s Cac-40 both more than 2% higher, while the Dow Jones Industrial Average in the US was up 0.7% as the London market closed.

The pound was up against the dollar at 1.55 after the greenback’s value fell. Sterling was also up against the euro at 1.21.

The retail sector had a strong day after the British Retail Consortium reported stronger-than-expected sales in December, following a “dazzling” week before Christmas.