FTSE gains over 1 pct amid global stock rebound
By Ana Nicolaci da Costa
LONDON, Aug 7 (Reuters) - Britain's top share index rallied more than 1 percent on Tuesday, led by financial and mining stocks, as equity markets globally staged a rebound from recent losses suffered on fears over the U.S. credit market.
At 1031 GMT, Britain's FTSE 100 index .FTSE was up 1.2 percent at 6,262.8 led by UK insurer Prudential (PRU.L) which rose 3.3 percent on an upbeat note from Citigroup that highlighted its growth potential and cash generation.
The Dow Jones Stoxx Banks index .SXPP was among best performers, up 2.1 percent. Barclays (BARC.L) gained 1.6 percent, HBOS HBOS.L rallied 1.7 percent and RBS (RBS.L) jumped 2.5 percent.
The sector benefited from a note by UK wealth manager Brewin Dolphin which said it was time to buy the FTSE 100 .FTSE index which was oversold, saying it favoured banks such as RBS, Northern Rock NRL.L and HBOS.
Elsewhere, Standard Chartered (STAN.L) rose 2.7 percent after it beat expectations with a 30 percent jump in half-year profit and said it would consider more acquisitions to accelerate growth, including in South Africa.
"For the UK and for most equity markets there's a very strong positive case to be made for buying the market given that earnings have been very strong and valuations are still attractive," said Chris Iggo, strategist at Axa Investment Managers.
"But you've got against that this feeling that problems in the U.S. could actually get worse and broaden out and have another negative impact on investor sentiment."
Miners added nearly 11 points to the index, benefiting from higher copper prices and as ABN AMRO upgraded Anglo American (AAL.L) to "buy" from "hold".
The stock was up 2.8 percent, Antofagasta (ANTO.L) rose 3 percent and Vedanta (VED.L) gained 2.8 percent.
Xstrata (XTA.L) was the weakest stock of the sector, falling 0.2 percent after announcing a $1 billion offer for South Africa's Eland Platinum Holdings Ltd ELDJ.J and after meeting forecasts with a 47 percent rise in first-half net profit. For more, double-click on [ID:nL0751833].
Back in the insurance sector, Standard Life (SL.L) rose 1.8 percent after a 31 percent rise in first-half sales, boosted by forecast-beating UK growth. It also said it expected to report a "significant increase" in its sales margins next month.
U.S. stocks rallied overnight as investors snapped up beaten-down shares of financial companies before an interest rate decision by the Federal Reserve.
The Fed is expected to leave U.S. rates unchanged at 5.25 percent and reiterate its concern about lingering inflation, but some analysts believe it may also acknowledge emerging signs of economic weakness.
Britain's biggest brewer, Scottish & Newcastle SCTN.L was among the few losers, down 0.3 percent, after reporting lower-than-expected first-half profit and saying full-year forecasts would be very challenging.
Amid mid-caps, British budget airline easyJet (EZJ.L) rallied 6.3 percent after posting a 5.7 percent rise in third-quarter revenues and saying July traffic rose 17.5 percent.
(Additional Reporting by Rebekah Curtis)
