Recovery in mining stocks nudges UK's FTSE higher

Fri May 3, 2013 6:42am EDT

* FTSE 100 edges up 0.2 pct, near 1-month highs

* Miners recover after rebound in copper price

* RBS slumps after Q1 results

By Sudip Kar-Gupta

LONDON, May 3 (Reuters) - Britain's benchmark equity index edged higher on Friday to put it within sight of one-month peaks, with the market led by a recovery in major mining stocks after a rebound in the price of copper.

The blue-chip FTSE 100 index crept up by 0.2 percent, or 9.49 points, to 6,470.20 points at mid-session.

Mining stocks dominated the FTSE leaderboard, with ENRC rising 6 percent after the recovery in copper.

The FTSE 350 industrial metals sector has fallen nearly 40 percent since the start of 2013 as signs of a slowdown in global economic growth have raised fears of lower demand for commodities and metals.

But some traders have sought to buy badly-beaten mining stocks - which are among the most volatile in the UK market - when they fall, before then selling them at a profit when they recover on any sign of a rebound in metals prices.

"Generally, the miners are on a slide, but there is value there," said Hartmann Capital trader Basil Petrides.

Part-nationalised British bank Royal Bank of Scotland slumped 5.6 percent to the bottom of the FTSE 100 after posting worse-than-expected operating profits, leading Investec to cut its rating on RBS to "sell" from "hold".

U.S. non-farm payrolls data later on Friday is likely to determine the near-term direction of the market, with economists in a Reuters poll forecasting 145,000 jobs were added in April.

EGR Broking managing director Kyri Kangellaris said U.S. jobs data that beat forecasts could push the FTSE back above the 6,500 point level, while worse-than-expected data could send it back down to the 6,200 point level. (Additional reporting by Toni Vorobyova; Editing by Catherine Evans)