Vodafone dials up second day of gains for UK's FTSE

Thu Feb 6, 2014 3:51am EST

* FTSE 100 up 0.2 pct, rising for second consecutive day

* Vodafone adds most points to FTSE

* FTSE had previously fallen for 5 days in a row

* FTSE still down 4 percent since start of 2014

By Sudip Kar-Gupta

LONDON, Feb 6 (Reuters) - Britain's top equity index rose for the second straight session on Thursday, as gains at telecoms group Vodafone enabled it to continue its break away from an earlier five-day losing streak.

The blue-chip FTSE 100 index, which had fallen for five straight days during the last two weeks, was up by 0.2 percent, or 15.66 points, at 6,473.55 in early session trading.

A 1.1 percent rise in Vodafone, after the mobile operator expressed confidence that its revenues would improve, added the most points to the FTSE 100 index.

Toby Campbell-Gray, head of trading at Tavira Securities, said Vodafone continued to attract investors due to its solid dividend yield and the fact there was bid speculation surrounding it, even though its American peer AT&T ruled out a bid for Vodafone last month.

"Vodafone's a quality stock. Why wouldn't you buy them?" said Campbell-Gray.

The FTSE 100 rose 14.4 percent in 2013 to post its best annual gain since 2009, but has since fallen by 4 percent since the start of 2014 as a slump in emerging economies knocked back global equity markets.

Yet in spite of the pullback and worries over the state of the emerging markets and a possible economic slowdown in China, many investors with a long-term view over the whole of 2014 remain bullish on the FTSE.

They have said the FTSE should continue to rise slowly over the course of the year, partly helped by signs of an economic recovery in Britain.

Darren Easton, director of trading at Logic Investments, said he was slowly building up "long" FTSE positions to bet on further gains, but would look to see if the FTSE could end this week above the 6,500-point level before adding to those positions.

Central Markets analyst Joe Neighbour said he would be happy to buy into the FTSE on days when the market fell provided it did not drop below 6,420 points - which represented its lowest level in December.

"Overall, we're still in a bull phase," said Neighbour.