A rally by recently beaten down mining stocks and banks helped haul Britain's leading shares index higher on Wednesday, as above-forecast U.S. private payrolls data provided a positive signal ahead of Friday's key U.S. February jobs report.

The ADP National Employment Report said the U.S. private sector added 216,000 jobs last month, topping economists' expectations for a gain of 208,000 and helping allay some of the recent concerns over the health of the global economy.

At the close, the FTSE 100 <.FTSE> index was up 25.61 points, or 0.4 percent at 5,791.41, regaining some of Tuesday's 1.9 percent slide, its steepest one-day fall since mid-December.

Miners <.FTNMX1770> led the rally in London, having fallen 9 percent over the previous five trading days, as the relative strength index - a closely-watched technical indicator - suggested the sector was near oversold levels.

Chilean copper miner Antofagasta , however, missed out on the sector rally, shedding 0.6 percent as its CEO Marcelo Awad resigned, surprising investors just a week before the company is due to publish full-year earnings.

Banks <.FTNMX8350> were higher, cheered by the U.S. data and by hopes Greece's private creditors will agree by the deadline on Thursday to participate in a bond exchange, a key part of a bailout programme to help Greece manage its wrecked finances and meet a debt repayment on March 20.

However, if fewer than 75 percent of creditors accept the offer, the debt swap could be off, potentially plunging the euro zone back into crisis.

BUY THE DIPS

While the market falls had been causing concern among some investors that the recent rally could be running out of steam, Trevor Greetham, Portfolio Manager, Fidelity's Multi Asset Funds, said he has been taking advantage of the dip to add further to his stock and commodity exposure.

Greetham said he has moved overweight risky assets in these funds for the first time since July 2011.

I am concerned that the economic cycles seem to be getting shorter and shorter and more reliant on support from policy makers. However, markets are more likely to peak out over the summer months than now given continued improvements in macro data and the pre-announced mid-year end date for the Fed's Operation Twist. I am buying the dip, Greetham said in a note.

Among individual stocks in demand, Burberry added 3.2 percent as the European Luxury goods sector rallied on renewed talk China will cut import taxes on luxury goods to boost consumption, following a report in The China Daily.

Burberry also got a boost from a target price hike by Goldman Sachs to 2,604.1 pence from 2,180.0 pence and a reiteration of its Conviction Buy stance on the stock in a note on Global Discretionary Retail.

Admiral Group was the top FTSE 100 gainer, up 10 percent, buoyed by above-forecast full-year results and an easing of injury claims that forced it to issue a profit warning in November.

Ex-dividend factors knocked a total of 11.01 points off the FTSE 100 index on Wednesday, with seven blue chip firms trading without their payouts including BAT and CRH .

Although the U.S. ADP data bodes well for Friday's U.S. job data, the lack of real fireworks today appears to show there is little investor confidence to get involved until then, said Mike Mason, trader at Sucden Financial Private Clients.

(Editing by Hans-Juergen Peters)