* FTSE up 0.1 percent
* Banks down; Lloyds up on rights issue
* Miners recover from early losses to lend most support
* Defensives rally
By Simon Falush
LONDON, Nov 24 (Reuters) - Gains in commodity stocks offset
weakness in banks to leave Britain's top share index slightly
firmer in choppy trade by mid-session on Tuesday.
By 1148 GMT, the FTSE 100 index <> was up 0.1 percent
or 7.31 points at 5,362.81, recovering from early weakness,
having finished up 2 percent on Monday when it recorded its
biggest one-day percentage rise in more than six weeks.
The UK blue chip index is up 20.8 percent this year and has
soared more than 50 percent since touching a six-year trough in
March, but remains 1.1 percent off levels prior to Lehman
Brothers' collapse in September 2008.
"As we head to the end of the year, trading is likely to be
scrappy as investors will want to book profits and will not want
to be too exposed to anything," said Peter Dixon, economist at
Commerzbank.
On a day of muted moves, banks were the biggest fallers.
Europe's biggest bank HSBC <HSBA.L> and Standard Chartered
<STAN.L> both fell 1.2 percent, while Royal Bank of Scotland
<RBS.L> fell 1.2 percent.
Banks were under pressure after ratings agency Standard and
Poor's said on Monday that a study of 45 banks found most were
weakly capitalised.
Separately, talk of possible capital-raising by Bank of
China <601988.SS> also weighed on the sector.
Lloyds Banking Group <LLOY.L> bucked the trend, rising 1.2
percent after it priced its record 13.5 billion pound ($22.4
billion) rights issue at 37 pence per share, a smaller than
expected discount, as it battles to escape a costly state-backed
insurance scheme for bad debts.
Barclays <BARC.L> also gained, up 0.5 percent.
Miners recovered some early weakness as metals prices inched
up from the day's lows, but most remained in negative territory.
Eurasian Natural Resources <ENRC.L>, Randgold Resources
<RRS.L>, Fresnillo <FRES.L>, Xstrata <XTA.L>, and Rio Tinto
<RIO.L> gained 1.1 to 2.1 percent.
The other main support for the index came from defensive
stocks as investors were reluctant to take big positions in more
cyclically focused stocks.
Beverage companies Diageo <DGE.L> and SabMiller <SAB.L>
added 1.1 and 1 percent respectively while utilities Centrica
<CNA.L>, National Grid <NG.L> and Severn Trent <SVT.L> added 0.6
to 1.1 percent.
British power generation company International Power <IPR.L>
rose 1.8 percent as Evolution Securities repeated its "buy"
rating, citing moves in Australia to improve coal plant
compensation.
Among other defensives, pest control to parcel delivery firm
Rentokil Initial <RTO.L> rose 1.2 percent, motor insurer Admiral
<ADML.L> added 1.6 percent and household cleaning products group
Reckitt Benckiser <RB.L> added 1.8 percent.
Among individual fallers, hedge fund firm Man Group Plc
<EMG.L> fell 0.7 percent as Credit Suisse downgraded its rating
to "neutral" from "outperform", on valuation grounds.
A raft of U.S. data due on Tuesday afternoon includes
November consumer confidence numbers, the September
Case/Schiller home prices survey, and the FHFA home prices
index.
Attention will also be on the minutes from the U.S. Federal
reserve's Nov 3-4 policy meeting, due after the London close at
1900 GMT.
((simon.falush@reuters.com. +44 20 7542 7681; Reuters
Messaging: simon.falush.reuters.com@reuters.net, editing by
Nigel Stephenson))
