FTSE higher as M&A talk picks up, China data helps

                                
 * FTSE 100 up 1.5 percent
                                
 * Cable & Wireless Worldwide up on bid talk - traders
                                
 * TUI Travel up on report shareholder TUI AG mulling bid
                                
 
                                
 By Tricia Wright
                                
 LONDON, Sept 1 (Reuters) - Britain's top share index was
higher by midday on Wednesday, helped by a pick-up in M&A talk
and with investor sentiment buoyed by firm economic data from
China.
                                
 By 1104 GMT, the FTSE 100 <.FTSE> was up 78.13 points, or
1.5 percent, at 5,303.35, after rising 0.5 percent on Tuesday.
                                
 "(M&A talk) is certainly helping the market higher. But the
FTSE is up on low volume," Manoj Ladwa, senior trader at ETX
Capital, said.
                                
 Cable & Wireless Worldwide <CWP.L> rose 5.5 percent, with
traders citing market talk of bid interest from U.S. rival AT&T
<T.N>. The British British would not comment.
                                
 TUI Travel <TT.L> also notched up good gains, up 5.4 percent
after the Financial Times Deutschland reported majority
shareholder TUI AG <TUIGn.DE> was considering buying the shares
in the company it does not already own. [ID:nLDE6800MZ]
[ID:nLDE6800M1]
                                
 TUI Travel also went ex-dividend on Wednesday.
                                
 Miners were in demand, led up by Fresnillo <FRES.L>, up 3.7
percent, fighting just shy of an all-time peak set in July as
well-worn talk of bid interest from Mexican Tycoon Carlos Slim
was aired again in the Daily Mail's market report.
                                
 The sector <.FTNMX1770> was lifted as metals prices rose on
the back of a rebound in manufacturing in China, the world's
largest consumer of metals. [ID:nBJB003928]
                                
 China's official purchasing managers' index rose to 51.7 in
August from a 17-month low of 51.2 in July, while Australia's
economy grew a stronger than expected 1.2 percent in the second
quarter. [ID:nBJB003928] [ID:nSYU010570]
                                
 
                                
 TELECOMS BOOSTED
                                
 Telecoms firms pushed higher, boosted by Vivendi <VIV.PA>,
Europe's largest telecom and entertainment group, which raised
its annual profit target after first-half results beat
forecasts. [ID:nLDE67N1NR]
                                
 Inmarsat <ISA.L> put on 2.6 percent, while Vodafone <VOD.L>
was 0.8 percent firmer.
                                
 Land Securities <LAND.L> climbed 2.6 percent after JPMorgan
Cazenove named the property company its top large cap pick and
raised its rating on the stock to "overweight" from "neutral".
                                
 Positive broker sentiment also gave Intercontinental Hotels
<IHG.L> a lift, up 2.9 percent, with Morgan Stanley lifting its
rating on the firm to "overweight" from "equal-weight", saying
it was undervalued and has strong prospects, especially in Asia.
                                
 Dampening the mood, growth in Britain's manufacturing sector
slowed more than expected last month, led by the weakest
expansion in new orders for more than a year, a purchasing
managers' survey showed. [ID:nLDE6800QB]
                                
 U.S. data being watched will include U.S. ADP National
Employment statistics ahead of non-farm payrolls due out on
Friday. Construction spending and ISM manufacturing PMI will
also be in focus, when they are released at 1400 GMT.
 (Editing by Dan Lalor)