* Banks rebound; RBS higher after update
* Oil majors weak, curbing FTSE 100's gains
* BA a top blue-chip riser after Q2 results
By Jon Hopkins
LONDON, Nov 6 (Reuters) - Britain's leading share index was
up 0.2 percent approaching midday on Friday with a rally by
banks offsetting weakness in oil majors in thin trade as
investors await the key U.S. October jobs report.
At 1136 GMT, the FTSE 100 <> was 10.63 points higher at
5,136.27, on track for around a 1.6 percent increase on the
week, which would be the best weekly performance for a month.
"We have seen some investors come in and take some profits
off the table but at present it is really quiet as everyone is
looking ahead to the non-farm payrolls," said Joshua Raymond,
market strategist at City Index.
The U.S. economy is expected to have shed 175,000 jobs in
October, the 22nd month of job losses, but lower than the
263,000 cuts seen in September. Unemployment, however, is
forecast to climb to 9.9 percent.
"If we see that the U.S. economy actually lost closer to
100,000 jobs than 200,000, then investors could react quite
positively and we could end the week on a high. However, a weak
number and the 5,100 support level on the FTSE could come under
threat quickly," Raymond said.
A rally by banking stocks provided the main strength for UK
blue chips as investors digested a third-quarter trading
statement from Royal Bank of Scotland <RBS.L>, which the top
blue-chip riser, up 7.5 percent.
Part-nationalised RBS made an operating loss of 1.5 billion
pounds ($2.5 billion) in the third quarter as it took 3.3
billion pounds of bad debts and profits at its investment bank
arm more than halved from the previous quarter. []
Lloyds Banking Group <LLOY.L> added 3.2 percent, buoyed by a
Citigroup upgrade to "buy" from "hold", accompanied by a
significant target hike to 104 pence from 37 after the firm's
withdrawal from the UK government's asset protection scheme.
Positive broker sentiment also aided Barclays <BARC.L>, up
2.7 percent, with JPMorgan lifting its target price. Standard
Chartered <STAN.L> and HSBC <HSBA.L> both added 2 percent.
British finance minister Alistair Darling said G20
policymakers are agreed that it is too early to pull the plug on
economic life-support packages as the global recovery is still
fragile. []
Annual input price inflation for British manufacturers
turned positive in October for the first time since February,
driven by a rebound in crude oil prices, official data showed.
[]
MINERS PROVIDE A PROP
Miners enjoyed a rally against a backdrop of firmer metals
prices, and were bolstered by upbeat broker comment.
Antofagasta <ANTO.L>, up 1.6 percent, was helped by a
Citigroup upgrade to "buy", while Rio Tinto <RIO.L>, Eurasian
Natural Resources <ENRC.L>, Xstrata <XTA.L> and Kazakhmys
<KAZ.L> added 0.7 to 1.4 percent.
Weakness in oil majors, after a rally on Thursday, proved
the main drag on the FTSE 100 index, with BP <BP.L>, BG Group
<BG.L> and Royal Dutch Shell <RDSa.L> off 0.8 to 1.1 percent.
Among individual movers, British Airways <BAY.L> gained 6.4
percent as investors welcomed second-quarter results from the
airline with BofA Merrill Lynch repeating its "buy" rating on
the stock. []
Rentokil Initial <RTO.L>, however, shed 7.4 percent as a
third-quarter trading update from the pest control to parcel
delivery firm failed to excite.
"Moves higher this week have been made difficult by investor
nerves and mixed sentiment. Investors have been highly sensitive
to economic data and this is why today's jobs data is so
important and could have a long lasting effect on how the market
behaves not just today but in the near term also," Raymond said.
(Editing by Simon Jessop)
