UK stocks : FTSE 100 adds 0.3 pct

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Reuters: London, Jan 26 2013, 04:05 IST
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of the FTSE 100's advance, with a 1.3 percent gain, as traders cited the impact of a Societe Generale upgrade to "buy".

British Airways and Iberia airlines group IAG was also a strong gainer, up 2.1 percent, having earlier hit its highest level in 18 months, benefiting as JPMorgan upgraded the stock to "overweight", traders said.

"We believe IAG shares will outperform once Iberia reaches agreement with unions (or implements unilateral cuts), and see the recent underperformance as a good entry point for investors," JP Morgan said in a note.

And broker comment boosted Russian gold miner Polymetal as well, up 2.4 percent as UBS upgraded its rating to "buy" from "neutral."

Miners in general, however, were weaker, retreating after gains on Thursday following positive factory data from top metals consumer, China. The sector's 0.9 percent decline knocked more than 5 points off the FTSE 100 index.

Anglo American fell 0.5 percent as it reported mixed quarterly production, badly dented by strikes that battered South Africa's mining industry last year.

The globally focused FTSE 100 shrugged aside news that Britain's economy is coming closer to dipping back into its third recession in four years, after growth shrank more than expected in the last three months of 2012.

Conall MacCoille, Chief Economist at stockbrokers Davy, said the 0.3 percent contraction was smaller than was first predicted with an expansion in construction the notable success story.

"Nonetheless, today's release is bound to increase the pressure on (British finance minister) George Osborne and herald talk of a triple dip-UK recession.

... contd.

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