* FTSE 100 flat at 6,554
* Tui Travel rallies after it raises guidance
* Compass gains on revenue growth expectations
* William Hill falls after Ladbrokes online warning
By David Brett
LONDON, Sept 26 Bullish updates from some of the
largest global companies helped keep the FTSE 100 in positive
territory early on Thursday, but the index remains restrained by
economic uncertainty in the United States.
Tui Travel, the world's largest tour operator, rose
2.6 percent after it increased the profit outlook it gave only
seven weeks ago.
Compass Group, the world's biggest caterer, which
climbed 1 percent after it said it expected revenue growth of
4.5 percent for the full-year after a strong year of contract
wins in its core North American market.
Tullow Oil rose 1.4 percent after announcing it made
a new oil discovery at its wildcat well in northern Kenya.
Worries, however, persist over earnings, which largely
remain in downgrade territory and have failed to keep up with
the recent re-rating in stocks: the FTSE 100 trades on a
price-to-earnings of 12.2 times, just above its ten-year
average, according to Datastream.
William Hill fell 2 percent after peer Ladbrokes
, Britain's second largest bookmaking group, warned
profit from its online operations would fall well short of
expectations, the latest in a series of setbacks for the
By 0714 GMT, the FTSE 100 was up 2.84 points at
6,554.37, having bobbed around in a tight range since mid-July,
between 6,400 and 6,650, with markets acutely aware of debt
wrangling and economic stimulus uncertainty in the United
States, which could curtail a fragile global economic recovery.
Investors were worried about two looming Washington
deadlines: before Oct. 1 Congress needs to pass stop-gap funding
for federal agencies and by Oct. 17 it must raise the federal
borrowing limit to avoid a debt default by the United States.
European markets, most of which are at multi-year highs,
remain stunted since Federal Reserve president Ben Bernanke
surprised investors by not starting to wind down economic
stimulus last week.
"It is difficult to second guess Bernanke but we need to be
alive to the fact that yields are rising and tapering will occur
at some point," Nick Mustoe, Chief Investment officer of the
global equity income fund at Invesco, said.
Mustoe said he still sees value in UK and European stocks,
with the core of his portfolio in consumer discretionary, which
have been the biggest outperformers since 2010, and
pharmaceuticals, but he is adding judiciously to his position in
From a technical standpoint the FTSE 100 has some downward
support targets at 6,434 and 6,393, which Steve Ruffley, chief
market strategist at InterTrader, said needs to be tested before
the bulls and value hunters come back into stocks.
"If (U.S. figures out this week) are not game changers all
the indices will grind down until the non-farm payrolls, which
may lead people to decide once again make trade calls on when
the Fed will announce tapering," he said.
In the United States the final reading of second-quarter GDP
and weekly jobless claims are set for release at 1230 GMT.
(Reporting by David Brett; Editing by Toby Chopra)