* FTSE 100 ends up 0.1 pct
* Defence companies lead; miners weigh
* Babcock, GKN, Meggitt top gainers after updates
* Go-Ahead slumps on GTR rail concerns
(Adds details, closing prices)
By Helen Reid
LONDON, Feb 28 Britain's main share index edged
up on Tuesday, despite being held back by mining stocks and
wealth manager St James Place.
The FTSE ended 0.1 percent higher, as gains by GKN
and Pearson outweighed losses from basic resources stocks.
Engineering group GKN rose 4.9 percent after it
reported a 12 percent rise in profit for 2016, and sales up 22
percent, ahead of forecasts.
Education services giant Pearson was a top gainer,
up 2.2 percent. The company posted results on Friday, promising
to further cut costs.
"We see this as a false hope," said Liberum analysts, who
rate the stock a 'sell'. "The shares are not factoring in the
structural risks from what seems like a similar story to what
happened in other challenged sectors such as newspapers."
Babcock Intl, the engineering support and
outsourcing company whose biggest client is Britain's Ministry
of Defence, was the top FTSE gainer, up 7.1 percent, after
saying it remained on track to achieve its full-year targets,
and had a 30.8 billion pound pipeline.
Wealth manager St James Place fell 3 percent after
it posted higher costs weighing on cash earnings, and said Chief
Executive David Bellamy would step down at the end of the year,
to be replaced by current Chief Financial Officer Andrew
"We view the internal hand over as being the best possible
result for SJP," said Panmure Gordon analyst Barrie Cornes in a
Miners were top fallers, tracking the pan-European basic
resources index lower. Fresnillo ended flat,
outperforming the sector after it reported a six-fold increase
in profit for 2016 on higher commodities prices and a weak
"The move to a net cash position prompted a larger than
expected final dividend of USc21.5/share," said UBS analysts.
"In our view FRES operational performance is improving and we
like its low cost core assets and industry leading growth
Retailers Marks & Spencer and Next rose 1.8
and 0.5 percent respectively. Jefferies analysts upgraded M&S
from 'underperform' to 'buy', saying it has closed the gap with
Next for quality of website content.
Defence equipment company Meggitt, a peer of GKN,
rose 13.1 percent after it posted a 13 percent rise in profit
Shares in Burberry rose as much as 5 percent to a
1-1/2 year high in a late-day volume spike after activist
investor GBL disclosed a 3 percent stake in the luxury goods
Berenberg analysts said the news was a positive for Burberry
shares, noting the sharp rally in Adidas after GBL
disclosed a 3 percent stake in the German sportswear maker in
Transport operator Go-Ahead Group was the top faller
on the mid-cap index, down 13.8 percent, its worst day in 8 1/2
months, after the company cut its full-year expectations due to
its GTR rail franchise, which had been beset by strikes.
"We expect consensus estimates to come under pressure, and
the uncertainty surrounding GTR is likely to also weigh on the
shares," said Liberum analysts.
(Reporting by Helen Reid; additional reporting by Danilo Masoni
and Vikram Subhedar; Editing by Mark Trevelyan)