* Commodity stocks gain on recovery in crude, metals prices
* Retailers jump; M&S results better than feared
* Banks bounce after sharp falls previous session
By Simon Falush
LONDON, March 31 (Reuters) - Britain's top share index was
up 3 percent by midday on Tuesday as miners and energy stocks
gained on recovering commodity prices and banks rebounded, while
a trading update from Marks & Spencer boosted retailers.
By 1058 GMT the FTSE 100 <> was up 113.15 points at
3,876.06, having slid 3.5 percent, or 135.94 points, in the
previous session.
On the last day of the first quarter, the blue-chip index
was down 12.4 percent from end-December and on track for its
worst first quarter since its inception in 1984.
High street retailer Marks & Spencer <MKS.L> jumped 10.5
percent after reporting better than feared fourth-quarter
like-for-like sales down 4.2 percent.
"The results were not as bad as feared and as the market
believed it was a well-shorted stock so it has bounced back,"
said Tim Rees, fund manager at Insight Investment.
However Rees noted that the market has merely recovered most
of the ground lost on Monday, and said stocks are vulnerable to
more bad economic or corporate news.
For now the data is painting a slightly less grim picture.
A survey showed British consumers grew less gloomy in March
as lower mortgage repayments boosted disposable income even as
the recession took an increasingly heavy toll on jobs.
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"Lower interest rates and borrowing costs seem to be
providing the consumer with material relief," Darren Winder,
head of macro and strategy research at Cazenove said, referring
to the Bank of England's move to cut the base rate to 0.5
percent, from as high as 5.5 percent last year.
Other retailers also fared well with clothing retailer Next
<NXT.L> gaining 6.6 percent and Home Retail <HOME.L> up 5.6
percent.
However, not all high street players prospered. Mid-cap
Debenhams <DEB.L> fell 11 percent after traders said HSBC was
placing 116 million shares at 40-45 pence.
Energy stocks gained, tracking crude prices that rose to
above $49 <CLc1> after a 7 percent fall the previous session.
BP <BP.L>, Royal Dutch Shell <RDSa.L>, BG Group <BG.L>,
Tullow Oil <TLW.L> and Cairn Energy <CNE.L> rose 1-2.3 percent.
MINERS, BANKS BOOSTED
Similarly miners gained on the back of firmer metals prices
with Rio Tinto <RIO.L>, Kazakhmys <KAZ.L>, Eurasian Natural
Resources <ENRC.L>, Anglo American <AAL.L>, Lonmin <LMI.L> and
BHP Billiton <BLT.L> gaining up to 10.8 percent.
Banks also recovered some of the ground lost on Monday as
nervousness about the state of the fragile sector eased.
HSBC <HSBA.L>, Standard Chartered <STAN.L>, Barclays
<BARC.L>, Royal Bank of Scotland <RBS.L>, and Lloyds Banking
Group <LLOY.L> added 1.8-6 percent.
Pharmaceuticals stocks were also strong gainers, with Shire
<SHP.L> adding 7.2 percent after it struck a deal with
GlaxoSmithKline <GSK.L> to co-promote its hyperactivity medicine
Vyvanse in the United States. Glaxo gained 3.2 percent.
Compass <CPG.L> added 6.8 percent after the world's largest
catering group said first-half profit was "well ahead".
British Land <BLND.L> was one of a handful of fallers on the
blue-chip index, sliding 3.4 percent with analysts pointing to
rights issue concerns for the property sector and worries it is
a target for short sellers.
(Editing by Greg Mahlich)
