Sharecast - The FTSE 100 was up 1.5% at 7,605.81.
Federal vice chairman Philip Jefferson said in a speech on Monday to the National Association for Business Economics that he would "remain cognizant" of higher bond rates and "keep that in mind as I assess the future path of policy".
Meanwhile, Lorie Logan, president of the Fed Reserve Bank of Dallas, also suggested that higher bond rates could help the Fed to slow inflation.
Oanda market analyst Craig Erlam said: "Equity markets are bouncing back on Tuesday after a risk-averse start to the week, buoyed perhaps by some promising Fed commentary on Monday.
"It would appear the recent surge in bond yields hasn't gone unnoticed at the central bank, to the extent that Fed officials are coming across as less hawkish in their views. Higher yields have been cited by various policymakers in what appears to be a sign that they are a little uneasy about how much influence recent commentary has had.
"While the Fed has previously signalled that another rate hike is likely in the tightening cycle, the central bank is ultimately data-dependent and won't want markets getting too carried away. It's a tough balancing act and inflation data will be released on Thursday which should provide further clarity again after Friday's mixed jobs report.
"It is perhaps a little surprising that markets have bounced back as quickly and strongly as they have given the clear risk aversion we saw at the start of the week. Hamas attacks in Israel created uncertainty around the Middle East and investors will no doubt continue to monitor the situation very closely."
On home shores, industry research out earlier showed that retail sales slowed dramatically in September, as milder weather affected seasonal clothing purchases and the cost-of-living crisis prevented consumers taking on big-ticket items like furniture and electricals.
According to the monthly Retail Sales Monitor, put together by the British Retail Consortium (BRC) and KPMG, sales rose at a year-on-year clip of 2.7% in September, down from the 4.1% jump seen in August.
That was in line with the three-month average growth of 2.7% but well below the 12-month average of 4.2%.
Food sales were up 7.4% over the three months to September, while non-food sales were down 1.2%. In-store non-food sales edged just 0.3% higher over the three-month period, while online non-food sales dropped 3.6%.
"Sales growth in September slowed as the high cost of living continues to bear down on households," said BRC chief executive Helen Dickinson.
"Big ticket items such as furniture and electricals performed poorly as consumers limited spending in the face of higher housing, rental and fuel costs. The Indian summer also meant sales of autumnal clothing, knitwear and coats, have yet to materialise."
It's important to note that the BRC-KPMG figures are not adjusted for inflation. So, with inflation still running higher than normal levels, the overall rise in sales masked a likely drop in volumes once inflation is accounted for. "As inflation eases, so too will longer-term sales growth prospects," Dickinson said.
The BRC chief also said that coming months will be "crucial" for retailers after recent heavy investments to bring prices down.
Investors were also mulling the latest data from Kantar, which showed that grocery price inflation eased for the seventh month in a row in the four weeks to 1 October, to 11% - the lowest rate since July 2022.
Tom Steel, strategic insight director at Kantar, said: "Grocery price inflation is still very high, but shoppers will be relieved to see the rate continuing to fall. For the first time since last year, the prices of some staple foods are now dropping and that’s helping to bring down the wider inflation rate."
In equity markets, heavily-weighted mining shares were among the top performers, with Anglo American (JO:AGLJ), Antofagasta (LON:ANTO) and Rio Tinto (LON:RIO) all up.
Electricals retailer Currys was in the black after saying it had received interest from several potential buyers for its Greek business, Kotsovolos. Responding to speculation in local media, the company said it was evaluating some non-binding offers.
Outside the FTSE 350, Irish convenience food group Greencore rocketed after saying that FY23 adjusted operating profit was set to be ahead of current market expectations and come in between £74m and £76m.
Market Movers
FTSE 100 (UKX) 7,605.81 1.52%
FTSE 250 (MCX) 17,872.65 1.71%
techMARK (TASX) 4,171.31 1.57%
FTSE 100 - Risers
Ocado Group (LON:OCDO) 597.60p 6.26%
Anglo American (AAL) 2,260.50p 5.21%
Prudential (LON:PRU) 905.20p 4.26%
Antofagasta (ANTO) 1,438.00p 3.98%
Land Securities Group (LAND (LON:LAND)) 601.60p 3.51%
Flutter Entertainment (CDI) (FLTR) 13,425.00p 3.51%
Ashtead Group (LON:AHT) 4,984.00p 3.40%
Barclays (LON:BARC) 157.06p 3.32%
Entain (LON:ENT) 951.80p 3.30%
Rio Tinto (RIO) 5,103.00p 3.21%
FTSE 100 - Fallers
Spirax-Sarco Engineering (SPX) 8,976.00p -1.04%
Haleon (LON:HLN) 338.65p -0.28%
Shell (LON:RDSa) (SHEL) 2,644.00p -0.19%
BP (LON:BP.) 519.60p -0.13%
Dechra Pharmaceuticals (LON:DPH) 3,802.00p 0.37%
Compass Group (LON:CPG) 2,056.00p 0.59%
B&M European Value Retail S.A. (DI) (BME) 570.60p 0.63%
Rentokil Initial (LON:RTO) 597.80p 0.64%
Halma (LON:HLMA) 1,930.50p 0.73%
National Grid (LON:NG.) 956.00p 0.76%
FTSE 250 - Risers
Playtech (LON:PTEC) 404.40p 5.59%
Oxford Instruments (LON:OXIG) 2,070.00p 5.08%
TUI (LON:TUIT) AG Reg Shs (DI) (TUI) 430.20p 4.98%
Drax Group (LON:DRX) 430.40p 4.98%
Energean (ENOG) 897.50p 4.97%
CAB Payments Holdings (CABP) 222.50p 4.95%
888 Holdings (DI) (LON:888) 93.50p 4.53%
PureTech Health (PRTC) 188.40p 4.32%
Spirent Communications (LON:SPT) 96.85p 3.86%
Intermediate Capital Group (LON:ICP) 1,380.50p 3.84%
FTSE 250 - Fallers
Syncona Limited NPV (SYNC) 120.60p -1.79%
BH Macro Ltd. GBP Shares (BHMG) 374.00p -1.58%
W.A.G Payment Solutions (WPS) 92.00p -1.50%
Pacific Horizon Inv Trust (PHI) 530.00p -1.30%
Ruffer Investment Company Ltd Red PTG Pref Shares (RICA) 268.00p -1.11%
Twentyfour Income Fund Limited Ord Red (TFIF) 97.80p -0.81%
Moonpig Group (MOON) 157.20p -0.76%
ICG Enterprise Trust (ICGT) 1,160.00p -0.34%
Hill and Smith (HILS) 1,646.00p -0.24%
Abrdn Private Equity Opportunities Trust (LON:APEO) 426.00p 0.00%