* FTSE 100 index ends 0.08 pct higher
* Stock market outlook positive, record high eyed
* ITV slips after disappointing update
By Atul Prakash
LONDON, May 14 Britain's top share index
steadied near a 14-year high at the close on Wednesday and
remained on track to set a record peak in coming months on
growing optimism that the economy is on a fast recovery path.
The benchmark FTSE 100 index ended 0.08 percent
higher at 6,878.49 points after touching its highest level since
December 1999 earlier in the session.
Analysts said the market was likely to be supported by an
improving economic outlook going forward and any price dips
could prove to be good buying opportunities.
In a further sign that the UK economy was gathering pace,
the unemployment rate fell to its lowest level in more than five
years in the first quarter, data showed.
"The FTSE remains underpinned by a strong domestic recovery
and foreign bid speculation. Technically it also looks healthy,"
Lex van Dam, a hedge fund manager at Hampstead Capital, said.
Traders said the index, which has been helped in recent
weeks by a burst of deal-making and bids alongside an improving
economy, had the potential to break above the all-time high of
6,950.60 points it set in 1999.
"We see the FTSE breaking 6,900, then moving to 7,000. We
are not at the inflection point as yet where equities offer
expensive valuations," Atif Latif, director of trading at
Guardian Stockbrokers, said.
According to Thomson Reuters Datastream, the FTSE 100 trades
at 13.7 times its 12-month forward earnings, against a 10-year
average of 11.7 times.
Sentiment also improved after the Bank of England said it
was still in no rush to raise interest rates, but some analysts
said it could happen earlier than the market was expecting.
"We maintain our view for the first bank rate hike to come
in November 2015," James Ashley, chief European economist at RBC
Capital Markets, said. "We remain comfortable with our
projection for tightening to be a H2 (of 2015) story."
Among individual movers, Compass was up 1.6 percent
after the caterer said it would return 1 billion pounds ($1.7
billion) to shareholders through a special dividend and raised
its interim dividend to 8.8 pence per share.
However, gains in the broader market were capped by a sharp
decline in broadcaster ITV, which tumbled 6.2 percent
after the company said its channels had not attracted the
audiences it wanted in the first four months of the year.
Analysts said ITV's second-quarter guidance for net
advertising revenue was just short of their 14 percent forecast
and the broadcaster had to make an effort to get back on the
front foot on audience numbers.
Stocks trading ex-dividend, including Royal Dutch Shell
, Glencore Xstrata and GlaxoSmithKline,
also limited the FTSE 100's gains.
(Additional reporting by Tricia Wright; Editing by Toby Chopra
and Susan Fenton)