* FTSE 100 index rises 0.4 percent
* Imperial Tobacco gains on positive outlook
* Housebuilders gain after Persimmon results
By Atul Prakash
LONDON, Aug 19 Britain's top share index climbed
to its highest level in nearly three weeks on Tuesday, tracking
strong gains in the U.S. market, with positive corporate news
helping companies such as Imperial Tobacco and Persimmon.
Imperial Tobacco advanced 1.6 percent after saying
it expected to report modest adjusted earnings growth in the
full year after volumes from its top growth brands rose by 3
percent in the first nine months.
UK housebuilders gained after Persimmon posted a 57
percent rise in pretax profit. It sold 6,408 new homes in the
six months to end-June and said it was trading ahead of last
year in the traditionally slower summer period.
"This is another strong set of results from a housebuilder,
backed up by substantial investment in the land bank, very
strong free cash flow generation, an improved balance sheet and
a significant payout to shareholders under the group's capital
return plan," Mark Cartlich, analyst at Sanlam Securities, said.
Persimmon results came in a day after Bovis Homes
posted strong first-half results, boosted by a record number of
completions, and said it expected to see a significant increase
in 2014 profits.
The Thomson Reuters UK Homebuilding index
rose 1 percent, helped by a 1 to 3.6 percent rise in shares of
Persimmon, Bovis Homes and Barratt Developments.
"The numbers (from housebuilders) are reassuring. Demand and
house price inflation have been very strong and that has been
getting reflected in the figures that we have been seeing," Henk
Potts, director of global research at Barclays, said.
"But there are some constraints from the supply side and we
have to see what demand looks like once interest rates start to
The UK blue-chip FTSE 100 index was up 0.4 percent
at 6,769.44 points by 0909 GMT after rising to its highest since
late July, also helped by fading investor concerns over the
Ukrainian government forces reported new successes
overnight, building on a weekend breakthrough when troops raised
the national flag in Luhansk, a city held by pro-Russian
separatists since fighting began in April.
However, gains in the broader market were capped by sharp
falls recorded by some individual companies.
Global miner BHP Billiton fell 3.6 percent after
reporting an 8 percent rise in second-half underlying
attributable profit to $5.69 billion, slightly below forecasts.
It also held off announcing a highly anticipated buyback,
disappointing investors who had been hoping for a buyback of up
to $8 billion, according to UBS estimates.
(Editing by Andrew Heavens)