* Miners rise; Rio Tinto update lifts confidence
* Banks strong ahead of JP Morgan Q4 results
* Oils slide as crude dips below $80
By David Brett
LONDON, Jan 14 (Reuters) - Britain's leading share index
rose 0.3 percent on Thursday as miners led a broad-based rally,
on strong numbers from Rio Tinto <RIO.L> <RIO.AX>, that outpaced
weakness in oil and retail stocks.
At 1153 GMT, the FTSE 100 <> was up 18.19 points at
5,491.67 after falling for two days on China's decision to
tighten banks' reserve requirements.
"The Rio figures have kept the mining stocks up. Things have
been fairly bullish since the start of the year and investors
used the pullback to buy on the dip," said Sam Wright, equity
trader at Spreadex.
"However, the FTSE appears quite happy around the 5,500
level," she added.
Miners were the biggest winners after Rio Tinto lifted
investor sentiment by beating its own forecast for iron ore
output in the fourth quarter.
Rio added 1.6 percent, while ENRC <ENRC.L>, BHP Billiton
<BLT.L>, Kazakhmys <KAZ.L>, Fresnillo <FRES.L> and Vedanta
Resources <VED.L> were up 0.4 to 1.8 percent. Xstrata <XTA.L>
rose 2.7 percent as Investec started coverage with a "buy".
Banks rallied ahead of fourth-quarter figures from JPMorgan
Chase <JPM.N> due on Friday. Barclays <BARC.L>, Standard
Chartered <STAN.L>, Lloyds Banking Group <LLOY.L> and Royal Bank
of Scotland <RBS.L> added 0.7 percent to 3 percent.
PHARMAS EYED
Defensive shares joined the gainers, with pharmaceutical
issues the biggest risers. AstraZeneca <AZN.L> rose 1.8 percent
as the firm continued to gain ground on a positive note from
Credit Suisse on Wednesday and Deutsche Bank upgrading its
target price on Thursday.
GlaxoSmithKline <GSK.L> added 0.9 percent, while Shire
<SHP.L> was up 0.4 percent.
Utilities lent their support, with Centrica <CNA.L>, Severn
Trent <SVT.L> and United Utilities <UU.L> up 0.3-0.7 percent.
Associated British Foods <ABF.L> gained 1.6 percent after a
positive trading update and Cadbury <CBRY.L> added 0.8 percent
on hopes that U.S. chocolate maker Hershey <HSY.N> might top
Kraft's <KFT.N> $17 billion hostile takeover offer.
Life insures gained ground, after Morgan Stanley raised its
target prices on Old Mutual <OML.L>, Prudential <PRU.L> and
Standard Life <SL.L>, which rose 1-1.2 percent. The sector has
been the subject of consolidation speculation for months.
Energy issues reversed early gains and were the biggest drag
on the index as the price of crude <CLc1> failed in its struggle
to remain above $80 a barrel.
Heavyweights BP <BP.L> and BG Group <BG.L> kept the sector
in negative territory as they shed 0.4 and 1.2 percent
respectively, while Royal Dutch Shell <RDSa.L> was flat.
Retailers were pummelled as a raft of blue-chip and second-
level firms reported trading updates. Home Retail <HOME.L> was
the FTSE 100's biggest faller after the group, which runs
catalogue-based Argos stores, warned trading would stay tough in
the coming year. It shares fell 6.2 percent.
Other large-cap retailers, Kingfisher <KGF.L>, Marks and
Spencer <MKS.L> and Next <NXT.L> also shed 0.9 to 2.3 percent.
Mid-cap HMV Group <HMV.L> and Mothercare <MTC.L> dropped 5.4
and 4.2 percent respectively, after both issued trading updates.
Food retailers joined the slump as investors locked in
profits following a raft of strong Christmas trading updates.
Wm Morrison Supermarkets <MRW.L>, J Sainsbury <SBRY.L> and
Tesco <TSCO.L> fell 0.2 to 0.6 percent.
Investors will eye U.S. data due later on Thursday including
December retail sales numbers, weekly U.S. jobless claims and
the revised December Philly Fed index.
(Editing by Erica Billingham)
