Reuters: Hot Stocks: Solid earnings lift Britain's FTSE

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Solid earnings lift Britain's FTSE Aug 1st 2013, 08:27 Thu Aug 1, 2013 4:27am EDT * FTSE 100 up 0.4 percent * Lloyds jumps on margins, costs, dividend plans * Miners lifted by solid China data * Shell's profits hit but traders remain bullish By Tricia Wright LONDON, Aug 1 (Reuters) - Britain's top shares edged up on Thursday, trading around two-month highs, as robust corporate earnings including from Lloyds Banking Group helped keep the market buoyant. By 0803 GMT, the FTSE 100 was up 29.10 points, or 0.4 percent, at 6,650.16. Lloyds topped the blue-chip leader board, up 6.4 percent, as the bank said it expected to meet its targets on cost savings, capital strength and margins earlier than anticipated, and that it aims to restart its dividend. Trading volume in Lloyds was solid, at 85 percent of its 90-day daily average against the FTSE 100 on 27 percent. The European second-quarter earnings season has proved mixed so far. Of about 50 percent of STOXX Europe 600 firms to have reported second-quarter results, 54 percent have met or beaten market forecasts, Thomson Reuters StarMine showed. The market drew some strength from the U.S. Federal Reserve's vow late on Wednesday to stick with its plan to purchase $85 billion of assets every month as it seeks to strengthen a "modest" U.S. recovery. Following the Fed, meetings at the Bank of England and the European Central Bank will fall under the spotlight. Markets are focused on what the banks say about future policy direction, with dovish guidance widely expected to continue. Strong gains in U.S. and European equities over the past year have been fuelled in part by ultra-loose monetary policy from central banks. While the UK benchmark is grinding higher, Alpari analyst Craig Erlam reckoned gains could be tempered given it is approaching short-term resistance at 6,660. "Above here, the next target will be 6,790, although it should find resistance along the way around 6,670. Below here it should continue to find support around 6,600, followed by 6,556, 6,544 and 6,535," he said. Buyers came in for mining stocks after official manufacturing activity data out of top metals consumer China came in better than expected. But Royal Dutch Shell hampered the FTSE 100's progress, with its A and B shares off 4.4 percent and 4.1 percent respectively, weighing down on the index to the tune of 24 points. While its second-quarter profits were hit by a combination of rising costs, a surge in oil thefts in Nigeria and other factors, some traders advised buying in on the weakness. "Clearly a disappointing set of numbers but we expect the (shares) to open down then start to recover... given the dividend yield of 4.9 percent that is a defensive play versus market volatility," Atif Latif, director of trading at Guardian Stockbrokers, said. (Reporting by Tricia Wright; Editing by Susan Fenton) Link this Share this Digg this Email Reprints

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