Sharecast - At 0825 GMT, the FTSE 100 was 1.5% higher at 7,659.51.
Craig Erlam, senior market analyst at Oanda, said: "The most hotly anticipated central bank meeting of the year did not disappoint on Wednesday, with the Fed potentially delivering this year's Santa rally.
"I don't think many will have expected the Fed to go as far as it did in forecasting three rate cuts next year only three months after suggesting the tightening cycle is not over. But clearly, it's not just investors that have been impressed with the data we've seen so far in the fourth quarter and now they're getting more carried away than before.
"There's been a lot of debate in recent weeks about whether investors are getting ahead of themselves, too optimistic about how quickly the Fed will cut rates but the message from the central bank is that is not the case. And in typical fashion, investors have now gone further, pricing in six rate cuts next year starting in March.
"That's also forced investors to reassess whether they're in fact too pessimistic with other central banks too, with the ECB now expected to cut rates by 150 basis points over the next 12 months and the BoE between 100 and 125 basis points."
The BoE rate announcement is due at midday, while the ECB will make its statement at 1315 GMT, with both expected to keep rates on hold.
In equity markets, electrical retailer Currys (LON:CURY) surged after it held annual guidance as interim losses narrowed and its Nordics unit reported an improvement in gross margins. The company posted a loss before tax of £46m, compared with a loss of £548m a year earlier. UK like-for-like revenue fell 3% to £2.2bn.
Bunzl (LON:BNZL) gained after saying it expects operating profit for the year to the end of December to be "slightly ahead" of prior guidance, helped along by acquisitions.
Serco advanced as it said its full-year performance would be better than initially expected, while Transact owner IntegraFin (LON:IHPI) rose after final results.
Market Movers
FTSE 100 (UKX) 7,659.51 1.47%
FTSE 250 (MCX) 19,171.78 2.55%
techMARK (TASX) 4,202.97 1.30%
FTSE 100 - Risers
Ocado Group (LON:OCDO) 692.00p 7.49%
Entain (LON:ENT) 912.40p 6.95%
Fresnillo (LON:FRES) 607.20p 6.79%
Endeavour Mining (EDV (LON:EDV)) 1,810.00p 6.02%
SEGRO (SGRO) 897.20p 5.90%
Land Securities Group (LAND (LON:LAND)) 704.00p 5.67%
Antofagasta (LON:ANTO) 1,641.00p 4.79%
Croda International (CRDA) 5,028.00p 4.45%
Unite Group (LON:UTG) 1,056.00p 4.37%
Spirax-Sarco Engineering (SPX) 9,894.00p 4.32%
FTSE 100 - Fallers
BAE Systems (LON:BAES) (BA.) 1,041.50p -1.83%
Associated British Foods (LON:ABF) 2,429.00p -0.49%
Sage Group (LON:SGE) 1,186.50p 0.00%
HSBC Holdings (LON:HSBA) 618.60p 0.00%
Ashtead Group (LON:AHT) 5,272.00p 0.00%
Anglo American (JO:AGLJ) (AAL) 1,779.40p 0.00%
Shell (LON:RDSa) (SHEL) 2,502.50p 0.10%
Dechra Pharmaceuticals (LON:DPH) 3,848.00p 0.10%
CRH (CDI) (LON:CRH) 5,230.00p 0.11%
Centrica (LON:CNA) 146.15p 0.21%
FTSE 250 - Risers
Currys (CURY) 50.45p 11.42%
Bridgepoint Group (Reg S) (BPT) 273.20p 8.50%
Ceres Power Holdings (LON:CWR) 181.10p 7.67%
Derwent London (DLN) 2,400.00p 7.35%
Big Yellow Group (LON:BYG) 1,238.00p 7.00%
Great Portland Estates (GPE) 427.40p 6.69%
IWG (LON:IWG) 170.30p 6.31%
LXI Reit (LXI) 98.50p 5.97%
Persimmon (LON:PSN) 1,353.50p 5.91%
British Land Company (BLND) 409.60p 5.65%
FTSE 250 - Fallers
Vietnam Enterprise Investments (DI) (VEIL) 546.00p -1.09%
Mitie Group (LON:MTO) 100.20p -0.30%
Redde Northgate (REDD) 362.50p -0.14%
Safestore Holdings (SAFE) 847.50p 0.00%
Renishaw (LON:RSW) 3,466.00p 0.00%
JPMorgan (NYSE:JPM) European Discovery Trust (JEDT) 409.00p 0.00%
North Atlantic Smaller Companies Inv Trust (NAS) 3,960.00p 0.00%
Worldwide Healthcare Trust (WWH) 303.00p 0.00%
BH Macro Ltd. GBP Shares (BHMG) 353.50p 0.00%
Ithaca Energy (LON:ITH) 141.60p 0.00%