* Banks higher; Citigroup bullish on domestic banks
* Miners, oils rise; China tightening fears fade
* BA gains; U.S. tentative OK to American Airlines deal
* U.S., Asian markets closed for public holidays
By David Brett
LONDON, Feb 15 (Reuters) - Britain's top share index gained
0.8 percent by midday on Monday, as banks and commodities
rallied following the previous session's falls and British
Airways climbed on hopes of a global alliance.
By 1154 GMT, the FTSE 100 <> was up 40.36 points at
5,182.81, having finished 0.4 percent lower on Friday, although
trade was thin with Wall Street and most Asian markets shut for
respective public holidays on Monday.
Anthony Grech, market analyst, at IG Index said with U.S.
and Asian market's closed we may have already seen the biggest
moves in the stock market today.
"There is always the potential for the Greece situation to
add in a little bit of short-term volatility but for now it
would not be a surprise to see sideways trading for the rest of
the session," he said.
Banks, which have been hit recently with uncertainty over
the European Union's Greek rescue plan, were back on the front
foot.
Barclays <BARC.L>, which is due to report full-year results
on Tuesday, Lloyds Banking Group <LLOY.L> and Royal Bank of
Scotland <RBS.L> added 1.2 to 3.1 percent, also helped by a
bullish note from Citigroup, which raised its earnings forecasts
and target prices for UK domestic banks.
HSBC <HSBA.L> and Standard Chartered <STAN.L> gained 1.5 and
0.6 percent, respectively.
EU leaders promised to help Greece at a summit on Thursday,
but did not give details on what they could do to support the
Mediterranean state in tackling a deficit and debt crisis.
[]
Appetite for perceived riskier assets returned as worries
over China's monetary tightening policy faded, with miners
Vedanta Resources <VED.L>, Xstrata <XTA.L> and Kazakhmys
<KAZ.L>, Antofagasta up between 1.3 and 3 percent.
Rio Tinto <RIO.L> was a strong performer, up 3.1 percent as
Merrill Lynch issued an upbeat note on the global miner, adding
it to its "Europe 1 list".
Energy stocks were also higher with BG Group <BG.L>, BP
<BP.L> and Royal Dutch Shell <RDSa.L> up between 0.5 and 1.2
percent.
BA SHINES
British Airways <BAY.L> was the top FTSE riser, up 3.7
percent after the U.S. Department of Transportation gave its
tentative approval to grant antitrust immunity to American
Airlines <AMR.N> and its four oneworld partners, including BA to
form a global alliance. []
Drugmaker GlaxoSmithKline <GSK.L> was 0.6 percent higher
after JP Morgan upgraded its recommendation on the stock to
"neutral" from "underweight".
Peers AstraZeneca <AZN.L> and Shire <SHP.L> also gained, up
0.1 and 0.7 percent, respectively.
Legal & General <LGEN.L> rose 2.3 percent. The life insurer
is scheduled to report its fourth-quarter new business figures
on Wednesday.
Selected defensive issues were among the fallers. British
American Tobacco <BATS.L> and Imperial Tobacco <IMT.L> fell 0.4
and 0.6 percent respectively, and consumer goods group Unilever
<ULVR.L> dropped 0.9 percent.
Europe's top home improvements retailer Kingfisher <KGF.L>
fell 1.2 percent ahead of results due on Thursday.
BT Group <BT.L> was the top FTSE faller, shedding 1.5
percent as the firm remained under pressure after last week's
pension deficit news.
No significant economic data was released on Monday, but
investors kept a wary eye on Tuesday's UK inflation data and
Wednesday's unemployment report.
