By Sarah Turner
LONDON (Dow Jones)--Banks led U.K. stocks higher on Friday, with
investors in the U.K. rewarding partly state-backed financials just
as American investors have done this week.
The FTSE 100 index closed up 0.2%, or 8.39 points, to 5,625.65.
Other European shares also advanced.
U.S. stocks recorded mild gains in early trading, building on an
increase from the previous session.
"One of the main catalysts for the [U.S.] move yesterday was
positive comments from Citigroup CEO Vikram Pandit in relation to
group profitability over the coming years," said Stephen Taylor,
strategist at Dolmen Securities.
British banks gained on Friday. Shares of Royal Bank of Scotland
rose 5% and shares of Lloyds Banking Group (LYG) climbed 3.4%,
while Barclays (BCS) shares added 2.4%.
"RBS has pushed out to its best levels since October and this
could well be signaling the start of a more positive attitude by
investors to the majority state-owned banks," said David Jones,
chief market strategist at IG Index.
RBS is 84% held by the British government, which also holds just
under half of Lloyds.
Still, lending giant HSBC Holdings (HBC), down 1.6%, couldn't
join in the banking-sector advance, after Asia-based analysts at
Goldman Sachs cut the lender to neutral and removed it from its
conviction-buy list.
The broker called HSBC Holdings' recent second-half 2009 results
"puzzlingly weak" across the board and noted the broker's subdued
performance in Asia compared to rival Standard Chartered , up 0.6%
on Friday.
Away from banks and British Airways shares climbed 2.2%.
A union representing cabin crew at the airline said Friday that
there will be a three-day strike starting March 20 and a four-day
strike starting March 27.
Satellite broadcaster British Sky Broadcasting advanced 5% to
598 pence amid speculation that News Corp. (NWSA), which holds
around 39% of BSkyB's shares, is considering launching a bid for
the shares it doesn't already own, Dow Jones Newswires
reported.
News Corp. is the parent company of both Dow Jones Newswires and
MarketWatch, the publisher of this report and declined to comment
on the speculation.
Outside the top index, retailer Liberty , owner of the iconic
Liberty store on London's Regent Street, jumped 7.3% to 295 pence
after it said that it has received approaches that may lead to an
offer being made for the company.
Liberty said it has been looking at a range of options over the
last six months, including seeking investors who could inject
capital to help grow the business. It added that it is too early to
determine whether or not the talks will result in a formal
offer.
Elsewhere in the retail sector, fashion retailer SuperGroup,
owner of the SuperDry brand, said Friday that it has priced its
initial public offering at 500 pence per share.
Based upon the offer price, the market capitalization of
SuperGroup when it starts trading on the London Stock Exchange on
March 24 will amount to around 395 million pounds ($595
million).
IPO news has gathered pace in London recently and
interactive-learning-technology firm Promethean World also set a
price for its initial public offering on Friday.
The firm said that it will price its shares at 200 pence each
which will give it a market capitalization of around 400 million
pounds.
Services Desk; Dow Jones Newswires; +44-20-7842-9319/9274