* FTSE 100 up 0.2 pct; HSBC adds most points
* Intertek recovers poise, boosted by dividend hike
* Technical buying helps buoy index after sharp drop
By Tricia Wright
LONDON, Aug 4 Britain's top share index halted a
three-day losing streak on Monday, bolstered by HSBC as
investors bought into the bank's beaten-down shares after it
posted first-half results.
HSBC rose 1.1 percent, accounting for nearly half of the
FTSE 100's points gain, in spite of a 12 percent drop in pretax
profits in the six months to the end of June to $12.3 billion,
just below analysts' forecasts.
HSBC shares initially dropped 2 percent after the results.
But they soon gathered steam as investors focused on its
positives, namely ongoing balance sheet strength and an
attractive dividend yield, and bought back into the shares which
have fallen some 17 percent from a peak in May 2013.
"The headline figures are negative ... but there are
mitigating factors... A very strong balance sheet, and a
dividend yield of nearly 5 percent which has got its obvious
attractions in the current interest rate environment," Richard
Hunter, head of equities at Hargreaves Lansdown, said.
"A 'strong hold' is the current (market) consensus. I can
see some upgrades to that consensus, providing investors are
prepared to take a longer view."
Gains were seen across the banking sector, with Lloyds
Banking Group up 0.6 percent, Royal Bank of Scotland
0.8 percent firmer, and Barclays up 0.3
The broader FTSE 100 was up 12.46 points, or 0.2
percent, at 6,691.64 points by 1416 GMT, recovering after a 1.7
percent drop last week. It was also helped by technical buying,
having climbed above a major support level on Friday - its
52-week moving average of 6,670 points.
Intertek, which tests goods to check they comply
with regulatory standards, led blue chips higher with a 7
percent gain as it raised its interim dividend by 6.7 percent to
16 pence per share and said it was on track to deliver
single-digit organic revenue growth.
Shares across the region fell sharply last week, despite a
second-quarter reporting season that has seen 53 percent of the
108 companies in the STOXX Europe 600 reporting
estimate-beating earnings, according to StarMine data.
Investor appetite has been sapped by the prospect of a
tightening in U.S. monetary policy following strong data, as
well as by geopolitical concerns ranging from tensions between
Russia and the West over Ukraine to Israel's shelling of Gaza.
Charles Stanley's technical analyst Bill McNamara reckons
the FTSE 100's downtrend will soon resume.
"I'm becoming concerned about its loss of momentum over
recent sessions," McNamara said. "I remain very cautious on the
UK market at the moment and my own sense is that we are going to
see further weakness before we see it back up towards the high."
Among mid-caps, engineer Balfour Beatty rose 2.5
percent after the Sunday Telegraph reported UK engineering firm
WS Atkins and Canada's WSP Global are vying
for control of its engineering and design business.
(Additional reporting by Francesco Canepa; Editing by Susan