The pound hit $1.50 for the first time since December on hopes that the UK has voted to remain in the European Union.

The pound hit $1.50 for the first time since December on hopes that the UK has voted to remain in the European Union.

Sterling was given a boost after Leave campaigner Nigel Farage said it looked as though Remain had "edged" the vote.

Last week the pound fell as low as $1.40 as traders tracked polls suggesting a flagging Remain campaign.

Earlier the FTSE 100 closed 1.2% higher to a two-month high of 6,338.1 points, with miners, banks and travel firms rising.

Wall Street also jumped in late trading, with theDow Jones and S&P 500 both closing 1.3% higher.

That was the best result for New York shares in a month, with the main measure of "fear" - the VIX volatility index - falling 18.5%, the biggest slide in six months.

'Dramatic' swings

Peter Cardillo, at First Standard Financial in New York, said: "The markets are the best judge of what is going to happen, and they are saying that Britain will remain.

"The key is the strong jump in the pound."

Analysis: Kamal Ahmed, BBC economics editor

Interesting scrap of information on Reuters. The agency reports that between 21:00 and 21:30, volumes of sterling trading reached a record level for the year.

That's 30 minutes before the polls closed.

I know that at least one hedge fund carried out its own polling on referendum day. There have been reports that other funds have done similar.

Did some of that information get into the market early, giving traders data to trade on?

Of course, a poll is not a result - but the old adage is "buy on the rumour, sell on the news".

Sterling has had a strong day on the markets - reaching a high for the year.

And has certainly been powering ahead since 22:00, touching $1.50 at various points.

The market certainly believes this vote is only going one way.

Chris Saint, senior analyst at HL Currency, said: "The key issue now for currency markets is whether rising expectations that the status quo will prevail are well-placed.

"Dramatic exchange rate swings are to be expected regardless of the result, with a sharp drop in the pound's value possible in the event of a Brexit."

European markets earlier added to the optimism, with the Dax in Frankfurt and the Cac 40 in Paris rising 1.8% and 2% respectively.

Brent crude rose sharply in late trading to end the day 2.1%, or $1.03 higher at $50.91 a barrel, while US crude added 98 cents to $50.11.

Higher oil prices bolstered shares in Shell, which closed up 3.1% in London, while BP was almost 1% higher.

Gold, regarded as a safe haven, fell 0.6% to a two-week low of $1,258.86 an ounce.

Thursday winners

The biggest riser on the London market was British Airways owner IAG, whose shares rose 3.6% to 528p as traders expected aviation to be helped by a remain vote.

London Stock Exchange Group ended 3% higher as its £21bn merger with Deutsche Borse looked more certain of going ahead.

Saxo Bank's head of FX strategy, John Hardy, said: "Everybody is a bit shell-shocked at the way the market has moved so aggressively (toward the UK remaining in the EU).

"If you are stuck with a short position, you are being forced out without even knowing the result, but what this also means is that a Brexit result is now a catastrophic risk