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Company News

FTSE gains as commods, banks up, M&S lifts stores

* Commodity stocks gain on recovery in crude, metals prices

* Retailers jump as M&S results better than feared

* Banks recover from sharp falls previous session

LONDON, March 31 (Reuters) - Britain's top share index rose 2.4 percent early on Tuesday, as miners and energy stocks gained on recovering commodity prices and retailers rallied after a trading update from Marks & Spencer MKS.L.

By 0813 GMT, the FTSE 100 .FTSE had added 90.02 points to 3,852.93, having slid 3.5 percent, or 135.94 points, in the previous session.

On the last day of the first quarter, the blue-chip index was down 13.1 percent from end-December and on track for its worst quarter since 2002, and the worst first quarter since its inception in 1984.

Iconic high street retailer Marks & Spencer MKS.L was the top performer jumping 11 percent after reporting fourth-quarter like-for-like sales down 4.2 percent, but better than feared.

“Taken with other trading statements over the last two or three months it looks as if consumer spending is not quite as weak as feared... and profit estimate seem to be falling at a slower rate,” said Darren Winder, head of macro and strategy research at Cazenove.

A survey showed British consumers grew less gloomy in March as lower mortgage repayments boosted disposable income even as the recession took an increasingly heavy toll on jobs. [ID:nLU595045]

“Lower interest rates and borrowing costs seem to be providing the consumer with material relief,” Winder said, referring to the Bank of England’s move to cut the base rate to 0.5 percent, from as high as 5.5 percent last year.

Other retailers also fared well with clothing retailer Next NXT.L gaining 6.6 percent and Home Retail HOME.L up 5.6 percent.

However not all retailers prospered; mid-cap Debenhams DEB.L skidded 11 percent to 48 pence after traders said HSBC was placing 116 million shares at 40-45 pence.

Energy stocks gained, tracking crude prices that rose to around $49 CLc1 after a 7 percent fall the previous session.

BP BP.L, Royal Dutch Shell RDSa.L, BG Group BG.L, Tullow Oil TLW.L and Cairn Energy CNE.L rose 1.2-2.5 percent.

Similarly miners gained on the back of firmer metals prices with Rio Tinto RIO.L, Kazakhmys KAZ.L, Eurasian Natural Resources ENRC.L, Anglo American AAL.L, Lonmin LMI.L and BHP Billiton BLT.L gaining up to 8 percent.

Banks also recovered some of the ground lost on Monday as nervousness about the state of the fragile sector eased.

HSBC HSBA.L, Standard Chartered STAN.L, Barclays BARC.L, Royal Bank of Scotland RBS.L, and Lloyds Banking Group LLOY.L added 2.8-6.3 percent.

Pharmaceuticals stocks were also strong gainers, with Shire SHP.L adding 6 percent after it struck a deal with GlaxoSmithKline GSK.L to co-promote its hyperactivity medicine Vyvanse in the United States. Glaxo gained 1.8 percent.

Compass CPG.L added 8.5 percent after the world's largest catering group said first-half profit was "well ahead". (Reporting by Simon Falush; Editing by Dan Lalor)

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