FTSE up 1.0 percent

A man walks past the London Stock Exchange in the City of London October 27, 2008.

LONDON (Reuters) - Britain's leading share index was 1.0 percent higher around midday on Tuesday as a broad-based pre-Christmas rally led by energy issues took hold following the release of slightly disappointing GDP numbers.

At 1156 GMT (6:56 a.m. EST), the FTSE 100 index .FTSE was up 54.36 points at 5,348.35, having closed 1.9 percent higher on Monday its biggest one-day percentage gain since December 1.

"Finally there are signs that Santa has turned up for the obligatory Christmas rally, although perhaps a little bit less generous than seen in previous years," said Henk Potts, market strategist at Barclays Wealth.

Investors shrugged aside a slightly disappointing final reading for British third-quarter GDP, with the quarterly contraction only revised back to -0.2 percent, from the -0.3 percent seen at the first revision, and the year-on-year figure unchanged at -5.1 percent.

"Third-quarter GDP was not revised up as much as expected, with the UK economy still in recession ... (and) although growth is expected to return in the fourth-quarter the outlook is still very poor indeed," Potts said.

Energy issues were the top blue chips performers although crude prices slipped back below $74 a barrel after OPEC, as expected, agreed to roll over its production targets following a meeting in Luanda.

Royal Dutch Shell (RDSa.L), BG Group (BG.L), BP (BP.L) and Tullow Oil (TLW.L) added 0.6 to 2.7 percent.

Cairn Energy (CNE.L) was the top FTSE 100 riser, up 4.7 percent after the company's 10-for-1 share split took effect.

Cairn's shares closed at their highest level since June 2008 on Monday after the explorer said it had secured a rig to allow it to commence a drilling program offshore western Greenland.

Defensive issues, traditionally laggards in a bull market, were also higher as the pre-Christmas rally took hold.

Pharmaceutical firms AstraZeneca (AZN.L) and GlaxoSmithKline (GSK.L) rose 1.7 percent and 2.5 percent respectively, while tobacco giants British American Tobacco (BATS.L) and Imperial Tobacco (IMT.L) gained 0.8 and 1.9 percent.

Mobile telecoms heavyweight Vodafone (VOD.L) added 1.1 percent following an upbeat interview with the firm's head of UK business, Guy Laurence in the Financial Times.

Banks were higher across the board as HSBC (HSBA.L) recovered from earlier falls, taking on 0.8 percent, with Barclays (BARC.L), Lloyds Banking Group (LLOY.L) and Standard Chartered (STAN.L) adding between 0.2 and 1.3 percent.

MINERS MIXED

Miners were mixed, although higher overall as the gold price rose benefiting from a weaker dollar. Kazakhmys (KAZ.L), Eurasian Natural Resources (ENRC.L), BHP Billiton (BLT.L) and Rio Tinto (RIO.L) added 0.1 to 0.5 percent.

But Xstrata (XTA.L), Vedanta Resources (VED.L) and Fresnillo (FRES.L) missed out, falling 0.6 to 0.9 percent.

British Airways BAY.L was the top FTSE 100 faller, down 1.2 percent as the winter storms in Europe continued to cause travel chaos, and following a U.S. ruling on the airline's planned link-up with American Airlines AMR.N.

American Airlines and British Airways should agree to concessions to secure approval of a bid to deepen their transatlantic alliance, the U.S. Justice Department said on Monday.

Travel group Thomas Cook (TCG.L) was also hit by concerns over the travel problems experienced in the UK and Europe after the heavier than usual snowfalls, shedding 0.8 percent.

On the second-line, housebuilders were good performers, led by Barratt Developments (BDEV.L) and Taylor Wimpey (TW.L), which were gained 2.0 and 3.6 percent respectively, after Goldman Sachs upped both stocks on valuation grounds in a sector review.

U.S. stock futures,, pointed to early gains on Wall Street on Tuesday, extending Monday's advance, although some key U.S. data will need to be digested.

The final reading for U.S. third-quarter GDP will be unveiled at 1330 GMT (8:30 a.m. EST) this afternoon, followed by November U.S. existing home sales data at 1500 GMT.

(Editing by Mike Nesbit)