* FTSE 100 up 0.2 pct
* IHG jumps after media reports of bid interest
* AstraZeneca falls after Pfizer walks; SocGen downgrades
By Tricia Wright
LONDON, May 27 Britain's top shares advanced on
Tuesday, led by InterContinental Hotels Group (IHG), one of the
latest stocks to be boosted by reports of deal interest.
IHG jumped 5.7 percent - the top FTSE 100
riser by some margin - in trading volume at more than a third of
its 90-day daily average after only an hour's trade.
The hotelier has rejected a 6 billion pound takeover offer
from a U.S. bidder, Sky News reported, citing unidentified
The news gave strength to a view that the FTSE 100 index
will push back up towards record highs in the near term.
"The fact that there is still M&A appetite even at these
sort of elevated prices gives you an idea that on a corporate
and institutional level there's still significant risk appetite
in the market and significant demand for equity assets," Matt
Basi, head of sales trading at CMC Markets.
"It's to be read as a positive I think in the short term for
the wider market."
Corporate activity newsflow, however, also triggered the
biggest falls from an individual stock on the UK benchmark, with
AstraZeneca off 2.2 percent after Pfizer walked
away from making a formal bid for its smaller British rival.
Societe Generale analyst Stephen McGarry downgraded the
stock to "sell" from "hold" on the news, setting a price target
of 36 pounds a share.
AstraZeneca went some way to limit gains on the broader FTSE
100, which was up 14.72 points, or 0.2 percent, at
6,830.47 points by 0754 GMT.
The UK equity market, which was closed for a public holiday
on Monday, played catch up with a strong rise in European
equities on solid election showings for governing parties in
Germany and Italy.
Earlier this month it climbed to 6,894.88, the highest level
since December 1999, when it set a record peak of 6,950.60
points. Although it has since sold off, with the index having
dropped 0.6 percent last week to post its biggest weekly decline
in more than a month, technical analysts remain optimistic.
"There is still reluctance among traders to take it through
6,900 at this point. That said, the FTSE looks well supported up
here and would probably have to break below 6,750 to alter that
impression," Charles Stanley analyst Bill McNamara, said.
(Reporting by Tricia Wright Editing by Jeremy Gaunt)