The FTSE 100 extended its end-of-year rally to close higher on Christmas Eve for the fifth straight session. Financial Times

Ahead the festive holiday, trading was thin. The main index closed 45.2 points, or 0.7%, higher at 6,479.3, up an impressive 3.2% over the last five sessions. It is up 4.1% so far this year.

Battered banking stocks made modest gains, with Barclays up 2.4 per cent to 516?p and Lloyds TSB 1.1 per cent higher at 475?p.

Other sectors that had been hard hit during 2007 also improved, including house builders, real estate companies and retailers. Persimmon was the leading FTSE 100 gainer, up 4.1% to 796p, Hammerson added 2.8% to £10.05.