By Dominic Lau
LONDON, April 11 (Reuters) - Britain's FTSE 100 <>
index slipped by midday on Friday after U.S. conglomerate
General Electric <GE.N> posted "disappointing" first-quarter
results, though oil shares offered some support.
By 1108 GMT, the UK's blue-chip index was down 31.2 points,
or 0.5 percent at 5,933.3, well off its day's high of 6,016.3
after the General Electric results were announced.
"There is absolutely no doubt a reaction to the GE results
has caused this about-face on the market," said Jeremy
Batstone-Carr, head of private client research at Charles
Stanley.
"Although there will be a knee-jerk disappointment to that
number, investors must in the prevailing environment have at the
back of their minds the perception that broadly, companies are
not going to meet their earnings expectations."
Oil shares were the biggest sectoral gainer as crude prices
<CLc1> steadied above $110 a barrel.
BP <BP.L> climbed 1 percent and rival Royal Dutch Shell
<RDSa.L> put on 0.9 percent. An upgrade to "overweight" to
"neutral" on BP from JPMorgan also boosted the stock.
Index heavyweight Vodafone <VOD.L> shed 2.8 percent after
Morgan Stanley analysts said the stock did not appeal to them
compared with KPN <KPN.AS>, TeliaSonera <TLSN.ST> or France
Telecom <FTE.PA> after meeting EU officials on routing costs.
The broker remained "underweight" on Vodafone.
General Electric, the second-largest U.S. company by market
capitalisation, reported an unexpected 6 percent drop in profit,
as the slumping U.S. economy and credit crunch drove down
profits at its financial, industrial and healthcare units. It
also lowered its earnings forecast for the year.
University of Michigan consumer sentiment data at 1355 GMT
will provide a further gauge of the strength of the world's
largest economy, which some believe is already in recession.
NO SWEET OUTLOOK
Cadbury Schweppes <CBRY.L> fell 2.7 percent after traders
expressed concern over its 2008 outlook, even though the
confectionery group said its sweets business had a strong start
to the year.
Friends Provident <FP.L> dropped 3.6 percent after sources
close to the matter said U.S. buyout group J.C. Flowers was
prepared to walk away from takeover target Friends, frustrated
at a lack of conctact with the insurer's management.
British engineering project manager Amec <AMEC.L> advanced
3.4 percent after UBS upgraded the stock to "buy" from
"neutral".
Positive comment on ITV's <ITV.L> advertising outlook from
Credit Suisse helped pushed the broadcaster's shares up 2.8
percent.
Also featured on the downside, Sage <SGE.L> lost 2.8 percent
after Citi downgraded its rating on the software company to
"hold" from "buy" and Panmure cut its price target on the stock.
BAE Systems <BAES.L> dropped 3.7 percent, extending the
previous session's 0.8 percent decline. A London court said on
Thursday a corruption investigation into arms deals with Saudia
Arabia should not have been halted.
British Energy <BGY.L> continued its ascendancy, up 1.4
percent as a number of suitors were knocking on the door.
A source close to the matter said France's EDF <EDF.PA> may
join the 11 billion pound bid battle for the UK nuclear power
firm, but will not overpay.
International Power <IPR.L> rose 3.7 percent.
(Additional reporting by Michael Taylor; Editing by David
Cowell)
