By Carla Mozee, MarketWatch

LONDON (MarketWatch) -- U.K. stocks bounded higher Wednesday, with gains for banks among those that pushed the benchmark index to its first advance in two sessions.

The FTSE 100 index rose 0.7% to 6,635.61, with chip designer ARM Holdings PLC jockeying for position as the session's top advancer, ending the day higher by 4.5%.

A 2.8% rise in shares of Standard Chartered PLC and a 1.3% advance for HSBC PLC paced a higher run for bank issues. But Glencore Xstrata PLC shares reversed course and fell 1%, moving into the loss column with Antofagasta PLC , which fell 2.6% after the copper producer was downgraded to sell from neutral at UBS.

The FTSE 100 finished Tuesday's session down 0.5%, extending declines from Monday as part of a downturn in global assets as investors sold off so-called momentum stocks, such as biotech and Internet companies.

European investors late Wednesday will look for any clues about the Federal Reserve's outlook on monetary policy. Then on Thursday, a policy decision from the Bank of England will arrive. The U.K. central bank is widely expected to hold its key interest rate at 0.5% and leave asset purchases unchanged.

U.K. equities on Wednesday held to higher ground after government data showed the country's exports of goods in February fell to the lowest level in more than three years, down 1.6% from January. Weakness was underpinned by lower sales to other countries in the European Union, the largest trading partner for the U.K.

The trading session brought in support for Kingfisher PLC . Its shares rose 3.3% as UBS raised its rating on the home-improvement retailer to buy from neutral, saying a possible acquisition of French retailer Mr Bricolage had more upside than it initially thought.

There could be more upside "from converting some of the owned stores (which lost EUR13 million last year) to Brico, whilst at least retaining the profitability of the franchise business at the current level of EUR37 million," said analyst Andrew Hughes in a note Wednesday.

IMI PLC also closed higher, by 1.9% after the engineering company was upgraded to overweight from neutral at HSBC.

Meanwhile, Nigerian oil and gas firm Seplat Petroleum Development Company PLC priced its initial public offering for a listing on the London Stock Exchange at 210 pence a share ($1.67). The company will be the first to have a dual Nigeria/U.K. listing, and based on the offer price, Seplat's total market capitalization is about $1.91 billion.

Seplat produces around 60,000 barrels of oil a day from three oil blocks it purchased from Royal Dutch Shell PLC in 2010, The Wall Street Journal reported.

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