In its 3 percent surge this week, the FTSE-100 index has broken out of a long slide that took it to nine month lows below 4,300. The rally could continue if results from heavyweight banks such as Barclays , HSBC and Royal Bank of Scotland match up to expectations.
Insurers Aviva and Old Mutual are also due to post results this week as Britain's earnings season continues in full flood. Away from financials, miner Anglo American and engineer GKN will report.
Mike Lenhoff, Chief Strategist at brokerage Brewin Dolphin, said this week's rally could take the FTSE from around 4,410 on Friday afternoon up to 4,500 quite rapidly.
"Even if no other companies reporting this week do well and just the banks do well then I think the market's going to fly. I feel it's hardly worked through its oversold condition, it could snap back quite a lot and we could quite easily see the market shoot up to 4,500," said Lenhoff.
"August is usually a month when a lot of things happen. People are away on holidays there's not much liquidity and it doesn't take much to move the market either way. If news flow is the slightest bit good then it could move it up quite a lot."
The FTSE-100 was slightly lower on Friday afternoon but still looking to post a solid gain on the week, its first weekly rise in over a month.
Alex Scott, analyst at Seven Investment Management, said investors wanted to see a run of confident company outlooks and some evidence that economic indicators were pointing higher.
"The earnings have by and large been delivered but companies have been a bit cagy on outlooks and investors are picking up on that. But valuations are much more reasonable than they were and I think there's just enough there for us to be feel confident about the next few months in the market," said Scott.
Tom Hougaard, Chief Market Strategist at financial bookmakers City Index, sounded a cautious note, arguing that trading history since the market shakeout at the beginning of the decade was full of short-term rallies.
Non-financials reporting this week include pay TV company BSkyB, Britain's biggest brewer Scottish & Newcastle and publisher Reed Elsevier.
Lenhoff at Brewin Dolphin said the FTSE had been due for a technical rebound.