* FTSE 100 rises for fourth straight session
* Energy Secretary's comments hit utility sector
* Fall in utility shares prevent FTSE from bigger gains
* Rise in Barclays adds most points to FTSE 100
By Sudip Kar-Gupta
LONDON, Feb 10 Fresh political pressure on
Britain's utility industry hit the sector's stocks and limited
broader gains for the UK's top equity index on Monday.
The blue-chip FTSE 100 was up by 0.2 percent, or
13.30 points, at 6,584.98 points in late session trading, with
the index rising for the fourth consecutive session.
A 1.4 percent rise at Barclays added the most
points to the FTSE, as analysts welcomed the bank's plans to
step up its cost-cutting programme after it published a snapshot
of its headline 2013 results.
However, a decline in major utility stocks prevented the
FTSE 100 from making bigger gains.
The utility sector was hit after British Energy Secretary Ed
Davey wrote to regulators to say the profit margins of major
energy companies' gas supply units were too high.
Davey also said British Gas may have to be broken up and his
comments knocked shares in the sector, with British Gas owner
Centrica falling 2.1 percent and rival SSE
declining by around 1 percent.
Utility stocks are often favoured by investors for their
solid dividend yields, but Cavendish Asset Management fund
manager Paul Mumford said political pressures on the sector were
turning him away from holding those stocks.
"I don't bother to hold them because you're up against all
these political headwinds," he said.
"There are other areas of the market where you don't have
the same amount of regulatory interference," added Mumford, who
said his preferred UK equity sectors include oil and gas, and
The FTSE 100 rose 14.4 percent in 2013 to post its best
annual gain since 2009, but the index has declined 2.5 percent
since the start of 2014 as global equity markets have fallen due
to concerns over a slump in emerging markets economies.
Despite this weak start to 2014, many investors with a
long-term view expect the FTSE to rise slowly over the course of
the year, partly helped by a gradual recovery in the British
Mike Franklin, chief investment strategist at Beaufort
Securities, said the index could rise by around 5 percent over
the next two weeks to eventually reach the 6,900 point level.
"The pace of returns may be a bit slower this year, but the
primary bull market is still intact," he said.