LONDON's blue-chip FTSE-100 index was helped to its biggest points gain in 13 sessions yesterday by buoyant banking stocks, with big software groups also lending support.

The Footsie finished 60.5 points higher at 6345.0, having been assisted in the afternoon by a strong opening by the Dow Jones Industrial Average in New York. The Dow was 73 points ahead when the London stock market closed.

Sterling was down more than one cent against the dollar in late trading, around $1.4575. It was undermined by growing negative sentiment towards the euro, which continued to struggle against the US greenback.

The pound was virtually unchanged against the euro, with the single currency around 60p.

Among the big Footsie gainers was HSBC, which gained in Hong Kong amid talk of a merger with US investment bank Merrill Lynch.

HSBC poured cold water on this tale but still finished 25p higher at 985p.

The sector as a whole was strong and accounted for 19 points of the Footsie's advance. Lloyds TSB put on 20p to 657p, and

Barclays was up 23p at 1871p.

Bank of Scotland, which saw its shares fall heavily last Wednesday even though its half-time results were better than expected, rose 13p to 605p. Royal Bank of Scotland edged 13p higher to 1440p.

The UK's big software companies enjoyed big gains. Leading them higher was Misys, which saw its shares surge 61p to 693.5p on its comments that it was becoming increasingly bullish about current-year trading.

Sage Group put on 38p to 543p. Among other information technology stocks, Sema Group jumped 52p to 1237p.

Meanwhile, Internet service provider Freeserve jumped 8p to 243p on renewed rumours that a bid might emerge.

Geo Interactive Media, a specialist in online audio and video transmission, rose 140p to 1455p. The company's broker, Lehman Bros, repeated a ''buy'' rating.

The techMARK 100 index closed 1.7% higher at 3846 points.

But it was not all plain sailing for new economy stocks.

Smaller information technology group ITNET crashed 112.5p to 352.5p on news that Hackney council was terminating its contract with the company.

Elsewhere, top-100 stock Granada Compass jumped 39.5p to 663p as fears receded over how French group Accor might finance a possible purchase of its hotels business.

RJB Mining leapt 7.5p to 62p on hopes of an imminent bid for Britain's largest coal mining company from US conglomerate Renco.

Going in the opposite direction was Danka Business Systems. Shares in the photocopier distributor slid 8p to 21.5p, reacting to a surprise warning from US giant Xerox Corporation that it would make losses rather than profits in its third quarter.

Shares in Sainsbury slipped 14.75p to 358p, making it the Footsie's worst performer. The retailer was hit by news of price cuts at arch-rival Tesco.

Marks & Spencer took a tumble to a 10-year low. It fell as low as 194p but later recovered to

finish 1.25p higher at 202.5p.

United News & Media jumped 29.5p to 773p, after bullish comment from Credit Suisse First Boston analyst Mike Picken.

Footsie heavyweight Vodafone had little impact for once, finishing just 0.5p higher at 251.5p.

Overall, second-line UK stocks were little changed. The FTSE-Mid 250 Index ended down just 3.9 on 6693.7 points.

Integrated power company Innogy Holdings, created by the demerger of National Power,

yesterday bounced back from Monday's weak debut with a 27p gain to 192.25p.