UPDATE 1-UK Stocks-Factors to watch on Feb 17

Mon Feb 17, 2014 2:29am EST

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LONDON Feb 17 (Reuters) - Britain's FTSE 100 index is seen inching higher on Monday, with futures gaining 0.1 percent by 0727 GMT ahead of the cash market open.

* The UK blue chip index closed up 4.20 points, up 0.1 percent, at 6,663.62 points on Friday.

The FTSE 100, up nearly 4 percent from its February lows, has now recouped more than half of what it lost during the recent emerging markets sell-off. It climbed above its 50-day moving average last week, a technical signal which suggested underlying support from buyers.

* The Bank of England will only start to increase interest rates when the economy is operating at closer to full capacity, central bank governor Mark Carney said in an interview broadcast on Sunday.

Carney also said that while he was concerned about Britain's history of booms and busts in house prices, a government scheme to aid home-buyers, Help to Buy, was not currently a major factor in boosting prices.

* HAMMERSON : The property company said its full-year net asset value rose 5.7 percent, and that it has lifted its dividend by 8 percent.

* ROYAL MAIL : Royal Mail and the Communication Workers Union have started talks on a company charter to enshrine their post-privatisation agreement over working conditions for more than 100,000 workers so that the terms can only be overturned by a vote of the company's shareholders, the Guardian reported.

* ESSAR ENERGY : The company said its largest shareholder, Essar Global Fund Ltd, has made a possible offer of 70 pence per share for the 22 percent stake it does not own in the London-listed oil and gas producer.

* ROLLS ROYCE : The company faces a showdown with investors over how it accounts for lucrative contracts to service aircraft engines, the Times said. The company will now hold a briefing on the issue at July's Farnborough airshow.

Also, an investigation by Britain's anti-fraud watchdog into Rolls-Royce's dealings in Asia extends to contracts signed less than three years ago, the Telegraph newspaper said.

* RSA : British insurer RSA is looking for prospective buyers for the sale of one of its Canadian businesses, which could help the company raise as much as 200 million pounds ($334.6 million), Sky News reported on Sunday.

RSA had previously said it was considering all options to raise capital that could include the sale of business units.

The Financial Times on Saturday said that RSA was sounding out institutional investors to raise as much as 350 million pounds ($585.59 million) in an emergency share placing that would allow it to avoid a rights issue.

* BARCLAYS : Sky News has learnt that Barclays has engaged headhunters to begin a search process to replace Sir David Walker as chairman in the coming months and has already commenced board discussions about the plan.

* LLOYDS BANKING GROUP : Lloyds is in talks with Britain's Prudential Regulation Authority over "ringfencing" rules in an attempt to save its investment banking functions, the Financial Times reported.

* British retailers Poundland and Pets at Home are expected to announce plans this week to list on the London Stock Exchange, The Sunday Telegraph reported.

* WHITBREAD : The company announced a partnership with Action Hotels to develop the Premier Inn brand across the Middle East.

* CAPITA : The outsourcing group has signed a framework contract for the Scottish wide area network.

TODAY'S UK PAPERS

> Financial Times

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