The rally saw the FTSE 100 rise 3% to 3,927.5 points and indications are that the sharp rise in London and the Nikkei in Tokyo will be followed later by Wall Street.
The rally follows reports that American tanks and armoured vehicles have advanced deep into the centre of the Iraqi capital. The BBC reported that President Saddam Hussein's main presidential palace had been captured along with the Iraqi information ministry.
It said that more than 100 armoured vehicles, including up to 70 tanks, stormed into the Iraqi capital early on Monday, supported by A-10 tankbusters and pilotless drones.
The move into Baghdad coincided with the advance of the British Army into downtown Basra where the HQ of the Ba'ath party was destroyed and soldiers from 3 Para (3rd Battalion The Parachute Regiment) were reported to be taking the centre of the city street by street.
WPP was up 7.66% at midday to 404.5p, its highest level for weeks. It came as the latest adspend forecast from ZenithOptimedia said that the war had not yet damaged hopes of an advertising recovery.
"We qualify our forecast with the risk that prolonged war would gravely damage advertiser confidence. A swift conclusion would do the opposite and, in particular, make an already firm upfront market tighter still," ZenithOptimedia said in its report.
Elsewhere in the advertising sector, media buying and research group Aegis was up 4.15%, or 2.5p, to 66p, while Cordiant Communications rose 2.08%, or 0.5p, to 24p.
Broadcasters in the media sector were also doing well this morning as Granada rose 4.55% to 67.25p up 3p. Its ITV partner Carlton Communications was also up on the positive news from Baghdad -- it rose 5.96% to 104p, up 6p. BSkyB was up 1.63%, or 10.5p, to 677p
Pearson was up 4.47%, a rise of 23.25p, to 555.25p, as Reuters rose 3.27% to 115p, up 3.5p.
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