* FTSE 100 up 0.5 percent
* TUI Travel up as German firm says merger plans on track
* British Land up on Bank of America Merrill Lynch upgrade
By Tricia Wright
LONDON, Aug 14 Britain's top equity index
advanced on Thursday, bolstered by hopes of an easing of the
crisis in Ukraine as well as expectations for a continuation of
ultra-loose monetary policy.
TUI Travel led the gainers with a 3.6 percent rise as
TUI AG's chief executive said the German company's
plans for a merger with the London-listed unit were on track.
Trading volume in the stock was strong, at 112 percent of
its 90-day daily average against around 30 percent seen on the
UK blue-chips extended their gains following what were seen
as dovish comments from Russian President Vladimir Putin on
Ukraine, where pro-Moscow separatists are fighting Ukrainian
In a speech to parliamentarians in Crimea, Putin said: "We
will do everything in our power so that this conflict is ended
as soon as possible, so that the blood can stop flowing in
Ukraine." He added that Russia did not need conflict with the
The news, which helped soothe fears of an escalation of the
Ukrainian crisis and tensions between the West and Moscow, was
met by investors betting that the continuation of loose monetary
policies will help bolster equities.
The German economy suffered a surprise contraction, its
first in more than a year, in the three months to June and
France slashed its growth forecasts for this year and the next
after its economy failed to grow in the second quarter.
The downbeat data clouded the macro economic picture in the
euro zone, but it was also seen shortening the odds of a move by
the European Central Bank to shore up the economy via an
asset-purchase programme, which would drive up share prices.
The poor economic data from the euro zone's two largest
economies followed weak UK wage growth data on Wednesday which
prompted the market to push back its expectations for when the
Bank of England would lift interest rates.
"Clearly Putin's comments have helped in de-escalating the
situation, but as a reaction to the poor economic data we've
been seeing - that's turned out to be quite positive for
equities," Richard Hunter, head of equities at Hargreaves
The blue-chip FTSE 100 index was up 36 points or
0.54 percent, at 6,692.77 points by 1203 GMT.
Property company British Land notched up good
gains, ahead 1.77 percent, after Bank of America Merrill Lynch
raised its rating on the stock to "buy" from "neutral".
(Additional reporting by Sudip Kar-Gupta; Editing by Mark