The London market pushed ahead and sterling touched its highest point since the start of the year as investors appeared confident that Britain would vote to remain in the European Union
Sterling hit 1.478 US dollars at one stage - its highest level since January 4 - building on the surge seen on Monday, when it notched up its biggest one-day gain against the dollar for nearly eight years.
The pound eventually eased to a 0.1% rise against the dollar at 1.469, while the FTSE 100 index was up 22.6 points to 6,226.6 after Monday's 182.9-point jump - which saw £47 billion added to the value of UK blue chips.
The London market had paused for breath before making further strides on the run up to the closing bell, with heavy-weight financial stocks among the biggest risers.
Standard Life and Barclays stepped up 8.1p to 331.4p and 3.5p to 180.4p respectively.
The session was also peppered with warnings over Brexit, with former England footballer David Beckham backing the push to stay in the EU, while legendary investor George Soros offered his gloomy prediction on the impact of a Brexit vote on the pound.
He warned the fall in the value of sterling would be ''bigger and also more disruptive than the 15% -devaluation that occurred in September 1992''.
Across Europe, Germany's Dax rose 0.5% and the Cac 40 in France surged 0.9%.
But benchmark London Brent crude gave up a two-day rally, sliding 1.5% to 48.89 US dollars a barrel, as the EU referendum vote caused trading to become volatile.
Miners were also in the red, with Anglo American down 11.7p to 658.3p and BHP Billiton slipping 4.6p to 847.7p.
In stocks, Costa Coffee and Premier Inn owner Whitbread climbed higher after it posted a bounce-back in sales at its coffee chain, with shares up 1.7% or 67p to 4108p.
The group cheered a "good start" to the financial year for Costa Coffee as it posted a 2.6% rise in like-for-like sales for the 13 weeks to June 2, marking a sharp recovery after sales were hit in the previous quarter.
This offset tougher trading elsewhere for the group, with Premier Inn like-for-like sales growth slowing to 2.1% in a "weaker-than-expected hotel market", while comparable sales edged 0.2% higher across its restaurant brands Beefeater, Brewers Fayre, Table Table and Taybarns.
Tesco was another strong riser, up 1.7% or 2.7p to 164.2p, ahead of its update on Thursday, which is expected to see it report its second consecutive quarter of UK sales growth for the first time in more than five years.
Housebuilders were among the biggest decliners in the FTSE 100, giving back some of the sector's gains seen on Monday as Brexit fears receded - with Berkeley Group down 1.3% or 43p to 3202p.
The biggest risers on the FTSE 100 Index were Mediclinic International up 30.5p to 923p, Intu Properties up 9.8p to 308.3p, Standard Life up 8.1p to 331.4p, Old Mutual up 4p to 187.8p.
The biggest fallers were Informa down 13.5p to 658.5p, Anglo American down 11.7p to 658.3p, TUI down 14p to 1015p, Sky down 12p to 875.5p.