The blue-chip index ended 1.6% higher, clawing back from a 0.7% drop in the previous session, aided by gains in banks, oil and mining stocks.
"Investors are buying the dip because it appears that the variant isn't going to be as disastrous as initially thought and they're using this pullback as an opportunity," said David Madden, market analyst at Equiti Capital.
Leading gains on the index were the rate-sensitive banks, up 2.3%, with major lenders including Standard Chartered, Barclays and Lloyds Banking Group all up nearly 3%.
Meanwhile, adding further gains were miners jumping 2.3% following a bounce-back in copper prices. [MET/L]
The blue-chip index suffered its worst monthly performance in over a year in November, as worries about vaccine efficacy against Omicron and hawkish comments by Federal Reserve Chairman Jerome Powell fuelled a selloff. [MKTS/GLOB]
Oil majors BP and Royal Dutch Shell climbed more than 3% each, as major producers prepared to discuss how to respond to the threat of a hit to fuel demand from the new variant. [O/R]
The domestically focussed mid-cap index added 1.7%, with Wizz Air and Easyjet leading gains. Other travel stocks recouped some of Tuesday's heavy losses.
"We are in a period of several weeks where the market will be increasingly desperate to find out just how much more infectious Omicron might be and whether it will escape existing vaccines," said Russ Mould, investment director at AJ Bell.
British Health Secretary Sajid Javid said there were 22 confirmed cases of the Omicron variant in the country, and urged people to book a COVID-19 booster shot.
Pendragon Plc climbed 9.7% after it raised its annual profit outlook for the second time in two months on continued robust demand for used vehicles.
Software group Blue Prism rose 2.4% after it agreed to be bought by U.S.-based SS&C Technologies for 1.24 billion pounds ($1.65 billion).
(Reporting by Bansari Mayur Kamdar and Amal S in Bengaluru; Editing by Uttaresh V and Shailesh Kuber)
By Bansari Mayur Kamdar and Amal S
