* Blue-chip FTSE 100 index ends 0.3 pct higher
* Index posts biggest weekly gain in 5 months
* Sky jumps 27 pct on takeover approach
(ADVISORY- Follow European and UK stock markets in real time on
the Reuters Live Markets blog on Eikon, see cpurl://apps.cp./cms/?pageId=livemarkets)
By Atul Prakash and Peter Hobson
LONDON, Dec 9 Britain's top stock index recorded
its biggest weekly rise in five months, with a late boost on
Friday when Sky shares surged by more than 25 percent
on a takeover approach from Twenty-First Century Fox.
Sky shares recorded their biggest ever one-day percentage
gain after the European pay-TV group said it had been approached
by Rupert Murdoch's Twenty-First Century Fox
Fox, which owns 39.1 percent of Sky according to Thomson
Reuters data, values the company at about 18.48 billion pounds
($23.23 billion) with its bid. Fox will pay 11.25 billion pounds
for what it doesn't already own of Sky.
"The deal is likely to see the light of the day as Murdoch
has interest in both the firms. It looks more like some tidy
housekeeping," said Jawaid Afsar, senior trader at Securequity.
"The news has changed the whole dynamics by putting the
sector in play. Some other companies in the sector could attract
serious buyers," he added.
Sky helped the blue-chip FTSE 100 to close 0.3
percent higher, taking the index's total gains for the week to
more than 3 percent - the biggest weekly rise since early July.
The week-long rally has been driven by financial stocks,
which rose across Europe after the "No" result in Italy's
constitutional referendum inflicted less damage than thought.
The market was also helped by the European Central Bank's
plan to scale back its monthly asset purchases, a surprise move
that lifted euro zone bond yields, which in turn are seen
helping reduce pressure on bank profits.
However, the UK banking index fell 1 percent on
Friday after surging 7.3 percent this week - the best weekly
gain since April. Barclays, Lloyds and Royal
Bank of Scotland fell 1.3-2.5 percent.
A decision by Britain's financial watchdog to delay its
final verdict on setting a deadline for consumers to claim
compensation for being mis-sold debt repayment insurance also
put pressure on banks.
After large gains in recent days, Chris Beauchamp, chief
market analyst at traders IG, said it was "not surprising to see
a bit of weakness creeping in".
Shares in "defensive" stocks with steadier incomes and
dividends were in demand.
Pharmaceutical companies GlaxoSmithKline and Shire
rose 1.2 percent and 2.4 percent respectively, while
British American Tobacco, Imperial Brands and
Unilever gained between 1.1 and 1.9 percent.
AstraZeneca rose nearly 4 percent after its
immunotherapy drug durvalumab, the British drugmaker's most
important pipeline medicine, was accepted for review by U.S.
regulators to treat bladder cancer, potentially its first use.
(Editing by Jeremy Gaunt and Alexander Smith)