The FTSE 100 was up 23.64 points, or 0.4 per cent, at 6,306.40 by 1213 GMT, having risen 0.6 per cent the previous session after suffering its sharpest one-day percentage drop in three months on Monday.
Hargreaves Lansdown jumped 9.1 per cent, with other asset managers rising in its wake, after it unveiled hefty increases in first-half profit, sales and assets.
"Clients trading Hargreaves stock are almost exclusively long, taking a bullish stance in anticipation of further gains," Rik Thakrar, risk manager and senior dealer at Spread Co, said in a note.
Major banks have been cutting trading staff and have had a scandal-ridden year. But while trading volumes are generally in decline, co-founder Peter Hargreaves said the firm was finding new clients at an unprecedented rate, boding well for the sector.
Blue-chip peers Schroders and Aberdeen Asset Management saw respective gains of 3.5 per cent and 0.9 per cent, while midcap Henderson climbed 1.7 per cent.
The fourth-quarter earnings season in Europe has got off to a fairly solid start. A quarter of companies have reported so far, with 60 percent having beaten or met expectations, according to Thomson Reuters Starmine data.
"The short-term outlook for equities remains to the upside, led by earnings... We may see a move back to 6,250 (range low) but this should be tested and then move back to the upside," Atif Latif, director of trading at Guardian Stockbrokers, said.
Latif targets 6,534, the high of 2008.
Andy Ash, head of sales at Monument Securities, noted that when equity markets make new tops, it can be a slow process, so the FTSE 100 might, for a matter of weeks, remain trapped within its recent range - 6,250 to 6,350 - before breaking out.
"The bears now know what level to sell it at, the bulls now know what level to buy it at, and you will get a locking of horns betwixt the two, which will lead us going nowhere but going up and down a lot," he said.
Kazakh mining group ENRC was another leading blue-chip gainer, up 6.5 percent after it reported higher quarterly output in its key commodities as well as a confident outlook for 2013.
"The Q4 production report, while mixed does show good growth in production of saleable ferroalloys and ferrochrome, and this coupled with expectations of a strong 2013 as stated by CEO Felix Vulis should at the very least underpin the stock at current levels," Richard Curr, head of dealing at Prime Markets, said in a note.
Also, several British newspapers carried reports of traders hearing vague speculation about a takeover bid from major shareholder Alijan Ibragimov of around 6 pounds a share.
Among fallers, Unilever shed 1.5 per cent after trading ex-dividend. — Reuters