* FTSE 100 up 4.8 percent
* Oils lead as crude rallies on OPEC cut hopes
* Miners gain; U.S. stimulus package boosts growth hopes
* Banks, insurers bounce back
By Jon Hopkins
LONDON, Dec 8 (Reuters) - Britain's top share index <>
was up 4.8 percent at midday on Monday, led by strong gains in
oils, miners and banks as hopes for a big U.S. economic stimulus
package lifted sentiment in hard-hit sectors.
At 1154 GMT the FTSE 100 index was up 192.75 points at
4,242.12, albeit below an earlier peak of 4,300.95.
The UK blue chip index closed 2.7 percent lower on Friday,
making a 5.6 percent decline on the week.
"This is a short term relief rally against a backdrop of
relatively cheap valuations," said Henk Potts, strategist at
Barclays Stockbrokers.
"Medium term we will need more information to sustain the
rally, and overall the mood will remain nervous," Potts said.
U.S. futures pointed to further gains on Wall Street after a
strong turnaround on Friday with disappointing jobs data
countered by Barack Obama's pledge for a big economic stimulus
package.
Miners rose, bolstered by recovering commodity prices on
hopes Obama's stimulus package will boost growth and help haul
the United States, and the rest of the world, out of recession.
Shares in Vedanta Resources <VED.L>, Anglo American <AAL.L>,
BHP Billiton <BLT.L>, Eurasian Natural Resources <ENRC.L> and
Rio Tinto <RIO.L> took on between 5.5 and 12.2 percent.
Anglo American and Rio Tinto will this week announce they
are slashing capital expenditure budgets for next year and
delaying building new mines until demand for commodities
recovers, the Financial Times reported.
Energy issues added the most points to the FTSE 100 index's
gains as crude prices <CLc1> recovered from a recent slide on
further hopes that next week's scheduled OPEC meeting will bring
production cuts from the oil cartel.
BG Group <BG.L> jumped 8 percent higher, Royal Dutch Shell
<RDSa.L> gained 6.6 percent and BP <BP.L> added 5 percent.
INSURERS, BANKS RALLY
Insurers gained strongly having been badly hit recently by
the slide in equity markets on valuations and concerns over the
impact of a recession.
Prudential <PRU.L> was the top FTSE 100 riser, up 14.1
percent, with Aviva <AV.L> ahead 9.4 percent and Legal & General
<LGEN.L> up 2 percent.
Badly beaten-up banks also rallied, as investors looked to
pick up some bargains, led by Barclays <BARC.L>, up 9.3 percent,
with Lloyds TSB <LLOY.L>, Royal Bank of Scotland <RBS.L> and
HSBC <HSBA.L> up between 3.6 and 6.3 percent.
There were only three FTSE 100 fallers at midday. Standard
Chartered <STAN.L> lost 4.9 percent with its recent rights issue
weighing, Liberty international <LII.L> fell 2.1 percent and
Wood Group <WG.L> shed 0.5 percent.
Among the mid-caps, news that David Ross, a director of a
number of companies had pledged some large shareholdings against
personal loans unsettled a number of firms.
Shares in Carphone Warehouse <CPW.L>, which Ross jointly
founded with Charles Dunstone in 1989, fell 3.5 percent on
concerns Ross might have to sell his 19 percent stake.
Self-storage group Big Yellow <BYG.L>, where Ross, a
director of the company, had also pledged 11.46 million of its
shares against personal loans, lost 5 percent.
Bus and rail group National Express <NEX.L>, where Ross is
chairman, shed 3.7 percent.
British producer prices and costs fell in November as oil
prices and petroleum product prices declined sharply.
(Editing by Jon Loades-Carter)
