By Johann M Cherian, Bansari Mayur Kamdar and Susan Mathew (Reuters) -London’s blue-chip FTSE index erased steep session losses to close higher on Wednesday, while the mid-cap index cut all of its bruising 3% plunge after the Bank of England’s promise of bond purchases lifted sentiment. The BoE said it would buy as many long-dated government bonds as needed between now and Oct. 14 to stabilise financial markets, adding that it would postpone the planned start of its gilt sale programme. UK gilt prices soared. [GB/] The move came after the pound sank to record lows earlier this week in the wake…