* Banks rebound; Bank of America to repay bailout
* Miners retreat after good run; gold off highs
* Kingfisher higher as Q3 beats expectations
By Jon Hopkins
LONDON, Dec 3 (Reuters) - Britain's top share index was up
0.2 percent by midday on Thursday, supported by firmer banks on
news Bank of America was set to repay government bailout funds,
but miners fell as the recent sector rally ran out of steam.
At 1149 GMT, the FTSE 100 <> was 8.48 points higher at
5,335.47, having closed up 15.22 points at 5,327.39 on
Wednesday, extending gains into a third consecutive session.
"Investor volume has started to taper off as we trade back
towards the high end of the range on the FTSE," said Nick Serff,
market analyst at City Index.
"With the ECB meeting later this afternoon and (U.S.)
non-farm payroll data tomorrow, we could see the market
consolidate around these levels over the next 24 hours."
Banks were the top risers with sentiment helped by Bank of
America Corp's <BAC.N> announcement it was to repay $45 billion
of government bailout funds.
Lloyds Banking Group <LLOY.L>, Royal Bank of Scotland
<RBS.L>, HSBC <HSBA.L>, Barclays <BARC.L> and Standard Chartered
<STAN.L> rose 1.0-4.1 percent.
Banks across the industry need to exercise restraint on
remuneration, British business secretary Peter Mandelson said on
Thursday when asked about bonuses at state-controlled RBS.
[]
Life insurers were back in favour, with Legal & General
<LGEN.L>, Prudential <PRU.L>, Aviva <AV.L>, and Standard Life
<SL.L> rallying 1.7-3.6 percent.
Oils were higher but mixed as crude prices <CLc1> held firm
above $77 a barrel following falls on Wednesday.
BP <BP.L>, BG Group <BG.L>, and Tullow Oil <TLW.L> lost
0.1-0.7 percent, but Royal Dutch Shell <RDSa.L> and Cairn Energy
<CNE.L> rose 0.9 percent and 0.6 percent respectively.
Cairn Energy is to seek approval for a 10-for-1 share split.
Among individual gainers, Kingfisher <KGF.L> added 0.7
percent after Europe's biggest home improvements retailer beat
third-quarter profit forecasts and said it was cutting debt more
quickly than expected.
Peer Home Retail Group <HOME.L> rose 1.7 percent on a
read-across from Kingfisher and helped by UBS which upgraded its
earnings forecasts for 2010 and 2011.
British Airways <BAY.L>, up 2.8 percent, was in demand ahead
of November passenger traffic numbers, due at 1415 GMT.
MINERS RETREAT
Heavyweight miners topped the FTSE 100 fallers list,
reversing earlier gains as the gold price <XAU=> slipped back
afetr hitting fresh record highs on Thursday, and other metal
prices steadied after recent advances.
Xstrata <XTA.L>, Fresnillo <FRES.L>, Rio Tinto <RIO.L>,
Lonmin <LMI.L>, and Anglo American <AAL.L> shed 0.6-2.1 percent.
Mobile telecoms heavyweight Vodafone <VOD.L> fell 0.8
percent, giving back some of Wednesday's gain having been buoyed
then by a Credit Suisse target price hike.
Among mid-cap stocks, pubs group Marston's <MARS.L> added
1.8 percent and gave a further boost to the sector when saying
trade continued to improve, after posting a 13.5 percent fall in
full-year pretax profit.
Punch Taverns <PUB.L>, Greene King <GNK.L> J.D. Wetherspoon
<JDW.L> and Mitchells & Butler <MAB.L> gained 0.9-1.8 percent on
the back of the news, which followed strong numbers from Greene
King on Tuesday.
Britain's service sector grew more slowly than expected in
November, a purchasing managers' survey showed, but new business
continued to pick up and firms were optimistic.
The Chartered Institute of Purchasing and Supply/Markit
activity index fell to 56.6 last month from October's two-year
high of 56.9. That was the seventh consecutive month above the
50 level that indicates expansion but below expectations for a
rise to 57.0. []
Investors were awaiting news from the latest European
Central Bank Council meeting, due at 1245 GMT, and initial
weekly U.S. jobless claims numbers, due at 1330 GMT, especially
ahead of the November U.S. employment report, scheduled for
release on Friday.
(Editing by Dan Lalor)
((jon.hopkins@reuters.com; +44 207 542 8954; Reuters
Messaging:jon.hopkins.reuters.com@reuters.net))
