* FTSE 100 up as U.S. retail sales numbers impress
* Miners, oils rally with firmer commodity prices
By David Brett
LONDON, Sept 15 (Reuters) - Britain's top share index rose for a third straight session on Tuesday to close up 0.5 percent, boosted by bullish economic data from the United States, as heavyweight oils, miners and banks underpinned the rally.
The FTSE 100 ended 23.28 points higher at 5,042.13, after trading as low as 4,996.52 earlier in the session.
The UK index is up 45.7 percent since touching its March lows. However, it is still 6.9 percent below the level it was before the collapse of Lehman Brothers a year ago.
"Investors have digested the figures from across the pond and have plunged back in to this market and decided to run with this rally," said Jimmy Yates, Head of Equities at CMC Markets.
U.S. retail sales rose at their fastest pace in three-and-half years in August as government-sponsored auto incentives buoyed demand for motor vehicles, according to data that showed sales outside the auto sector also were strong.
Meanwhile, U.S. producer prices rose more than twice as much as expected in August on the biggest surge in gasoline prices in more than 10 years and prices declined less than expected compared with a year ago, a government report revealed..
The market also got a boost from U.S. Federal Reserve Chairman Ben Bernanke who said the U.S. economic recession was probably over but the recovery would be slow and take time to create new jobs.
Energy stocks were higher, underpinned by a strengthening U.S. dollar which rose against a basket of currencies and lifted crude, which hovered around $69 a barrel.
BP, Royal Dutch Shell and Cairn Energy gained 0.6-3.7 percent.
BG Group added 1.4 percent after unveiling another discovery in the Santos Basin concession, offshore Brazil.
Oil and gas explorer Tullow Oil, up 1.2 percent, also got an additional boost from bid speculation, with market chatter mentioning Italian ENI as a possible predator. Neither company commented on the rumour.
International Power was up 2.6 percent in a read across from news that China's sovereign wealth fund is eyeing a stake in U.S. power company peer AES Corp.
Takeover speculation also saw Man Group climb 3.2 percent on rehashed bid rumours.
"It's no surprise that investors are once again targeting the usual suspects (miner, banks and oils). They're getting their bang for their buck," Yates said.
BANKS MIXED
Banks were mixed. Royal Bank of Scotland, HSBC and Standard Chartered rose 1.3-1.4 percent, while Lloyds Banking Group and Barclays were 0.6 and 0.2 percent lower respectively.
Bank of England Governor Mervyn King said the central bank was looking at reducing the rate on commercial banks' reserves, fuelling speculation of further quantitative easing. The comments sent sterling lower.
Miners gained as metal prices rebounded from the previous session's lows. Fresnillo, Rio Tinto, Xstrata, BHP Billiton and Kazakhmys added 0.5-3.7 percent.
Also on the upside, BT Group rose 4.4 percent, buoyed by a Credit Suisse upgrade to "outperform" from "neutral", while precious metals and chemicals firm Johnson Matthey gained 3.2 percent following a Goldman Sachs upgrade.
Rexam fell 2.2 percent after Credit Suisse removed the drinks can maker from its Focus List, and technology firm Smiths Group shed 1.7 percent after Morgan Stanley cut its rating to "equal-weight".
(Editing by David Cowell)