* FTSE 100 up 0.2 percent
* 50-day moving average, at 6,451, to provide support
* Fresnillo, Randgold up, bolstered by gold price
By Tricia Wright
LONDON, Aug 16 Britain's blue chip shares crept
higher on Friday, finding technical support after suffering
their steepest one-day percentage drop in almost two months in
the previous session.
The FTSE 100 was up 0.2 percent at 6,495.75 points
by 1453 GMT, having fallen 1.6 percent on Thursday. Analysts
said that the 50-day moving average, currently at 6,451, would
provide short-term support.
Should the index close below this level, then the immediate
levels of support on the way down are 6,400, previously
resistance, followed by the 200-day moving average, currently at
6,292, according to GFT Markets analyst Fawad Razaqzada.
"Although my long-term outlook is still bullish on the FTSE,
I will feel the same way about the near-term trend if and when
the index takes out 6,640."
The steep falls on Thursday came after robust U.S. jobless
claims data, which fuelled concern the U.S. Federal Reserve
might, from next month, start cutting back its stimulus - one of
the major drivers of this year's equity market rally.
This trimmed the UK benchmark's gains this year to around 10
percent, taking it down about 6 percent from the year's high of
6,875.62 points set in late May.
"Quite a few valuations have started to look quite full so
it feels like maybe there's a bit of taking profits in some
shares," Smith & Williamson fund manager Tineke Frikkee said.
Frikkee has bought into Tui Travel, which is looking
better value after sharp falls on Thursday along with the wider
market and on the back of concerns over Egypt in light of the
violence in the country.
The company now trades on a 12-month forward price/earnings
ratio of about 11.5 times against the FTSE 100 on about 12
times, according to Thomson Reuters Datastream.
Paul Kavanagh, a partner at Killik & Co, said: "I would say
that the nearer (the FTSE 100) gets back down to 6,000 again the
more aggressively positioned one would be ... because you would
start to see some valuations coming back into stronger buy
Kavanagh sees opportunities in the mining sector, the
biggest fallers this year by some margin, with the FTSE 350
Mining index down about 13 percent.
Over the period, the STOXX 600 Basic Resources index's
12-month forward price/earnings ratio has fallen to 10.5
times from 11.3 times, according to Thomson Reuters Datastream.
Gold miners Fresnillo and Randgold Resources
were among the top risers, with respective gains of 5.2
percent and 4.6 percent, after gold hit a two-month high earlier
(Reporting by Tricia Wright, additional reporting by Francesco
Canepa; Editing by Susan Fenton)