* FTSE 100 up 0.1 pct
* Intercontinental Hotels disappoints on further cash
* BHP supports index after results beat expectations
By Francesco Canepa
LONDON, Feb 18 A drop in Intercontinental Hotels
held down gains by Britain's top equity index on Tuesday
after the hotel operator failed to give more cash back to
shareholders, disappointing the market.
Supporting the index was global miner BHP Billiton,
which rose 1.5 percent after topping market forecasts with a 31
percent rise in first-half profit, despite a cautious outlook on
Shares in Intercontinental Hotels retreated from an all-time
high after the company offered no new plans to return money to
shareholders, even though it had recently sold some property.
"They sold two big assets ... but the current (share)
buyback is ongoing so it was perhaps a bit naïve to expect a
large capital return today," said Tim Barrett, an analyst at
Nomura. He expects profit estimates to decline slightly because
of refurbishment at several group properties this year.
Volume on InterContinental shares was 10 percent higher than
its full-day average for the past three months at 1138 GMT,
making it the most heavily traded stock on Britain's FTSE 100
index in relative terms. Volume on the FTSE was a third
of its own 90-day average.
The drop in InterContinental Hotel was starting to lure
bargain hunters into the stock. The shares hit an intra-day low
at 1,946 pence before recovering a little, as the fundamental
investment case on the company was seen as intact.
"We feel that despite the delay in the cash return it is
going to be a good buying opportunity (as) fundamentals remain
firm," said Ed Woolfitt, head of trading at Galvan.
"We have identified the short term support at around 1,945
as holding...and we are buying as close to 1,950 as we can get."
The stock was the biggest decliner on the FTSE 100 index
. The index itself was up 8.92 points, or 0.1 points, to
6,744.92 points at 1144 GMT.
Utility Centrica knocked 1.6 points off the index
after investment bank UBS cut its rating on the stock to "sell"
from "neutral," citing increased political pressure on the
company to cap its prices before next year's general election in
The FTSE 100 has risen in nine of the last 10 sessions, all
but erasing its losses for the year. The losses largely came on
concern about emerging market economies, which has now eased.
"I'd be looking to buy into any correction," said Hantec
Markets analyst Richard Perry. "The general mood of the market
is still to push higher."