* FTSE flat; U.S markets closed on Monday
* Miners weak on global recovery doubts
* BP up, helped by strategic investor reports
By David Brett
LONDON, July 5 (Reuters) - Britain's FTSE 100 share index
was little changed by midday on Monday with weakness in miners,
on continuing doubts over the health of the global economic
recovery, outweighing firmer oils, led by BP <BP.L> following
media reports that it was seeking a strategic investor.
By 1112 GMT the FTSE 100 <> was down 1.26 points at
4,836.87, having closed 0.7 percent higher on Friday.
With U.S. markets closed on Monday for the Independence Day
holiday and little company news or economic data, trading
volumes in London were thin -- the FTSE 100 traded just 15
percent of its average 90-day volume approaching midday.
"It shows just how unwilling investors are to dip their toes
into the market at the moment - scared of being burnt," said
Jimmy Yates, head of equities at CMC Markets.
Miners were the top fallers as investors worried about the
demand outlook and the stability of the global recovery after
disappointing jobs data from the U.S. on Friday and figures from
China on Thursday showing a cooling of manfacturing growth.
Rio Tinto <RIO.L> and Xstrata <XTA.L> were down 1.7 and 1.5
percent respectively.
Banks fell ahead of the publication later this month of
European stress tests on the sector, with Royal Bank of Scotland
<RBS.L> and Barclays <BARC.L> the two biggest fallers in the
sector down 2.4 and 1.8 percent.
However, UBS said in a note that running a credit stress
test along the lines of the U.S. tests of 2009 would see all the
major European banks pass.
French economy minister Christine Lagarde said on Saturday
that the test results, to be published on July 23, will show
that "banks in Europe are solid and healthy".
London's blue chip index lost 3.9 percent last week after
shedding 13.4 percent in June with investor doubts mounting
worries over the sustainability of the global recovery.
Britain's services sector expanded at its slowest rate for
10 months in June after concern about the impact of a public
spending squeeze led to a record monthly drop in confidence, a
survey showed on Monday. []
MARKS
Marks and Spencer <MKS.L>, Britain's biggest clothing
retailer, was the top FTSE 100 performer, up 3.0 percent ahead
of a fiscal first-quarter trading update due on Wednesday.
Meanwhile, embattled oil major BP <BP.L> was a strong
performer, up 2.8 percent on optimism that the plugging of the
leaking well in the Gulf of Mexico is now only about a month
away, and amidst media reports that the company was seeking a
strategic investor to secure its independence.
The weekend newspaper reports said BP was looking for a
shareholder willing to buy a 5 to 10 percent stake at a cost of
up to 6 billion pounds. BP's rivals Exxon <XOM.N>, Total
<TOTF.PA> and Royal Dutch Shell <RDSa.L> have all been touted as
possible bidders, according to the reports.
Additionaly, a report by a Kuwait newspaper said OPEC member
Kuwait may buy some of BP's <BP.L> Middle East and Asian assets
as part of the British oil company's attempt to raise funds and
fend off takeover bids. []
Elsewhere, TUI Travel <TT.L> gained 0.9 pct, as UBS upped
its rating on the tour operator to a "buy" from "neutral" on
valuation grounds, though it lowered its share price target to
250 pence, from 265 pence.
(Editing by Greg Mahlich)
