* FTSE 100 up 0.6 pct
* Centrica, SSE dip as investors eye Conservative campaign
* Micro Focus sinks as buyout target's revenue falls
* Mining shares underpin gains; utilities fall back
* Asset manager Henderson gains as UBS ups to 'buy'
(Adds closing prices)
By Helen Reid
May 9 Energy companies Centrica and SSE were
among the worst-performing stocks on Britain's FTSE on Tuesday,
after British Prime Minister Theresa May vowed to cap energy
prices if she was re-elected in June.
While the blue-chip index ended up 0.6 percent at
its highest level since early April, big declines stole the
May pledged to introduce a ceiling on domestic energy prices
that would cut tariffs for around 17 million families. She said
energy regulator Ofgem would be ordered to cap the costs of
standard variable tariffs, the package used by two-thirds of
customers in Britain.
Centrica and SSE both fell 1.2 percent,
continuing a decline that began when the Conservatives first
hinted at the policy, which could erode the firms' margins.
"The government has stated that two-thirds of customers are
on the higher 'standard' rates, and clearly if the cap is below
this level this will hit margins directly," said Edward Park,
director of the investment committee at Brooks Macdonald.
"But the government will need to be careful not to cause
excessive pressure on the energy market as capex in areas such
as 'smart meters' are also viewed as helping retail customers
make informed decisions," he added.
The cap could cost Centrica up to 200 million pounds, Neil
Wilson of ETX Capital estimated.
Micro Focus fell 5.6 percent to the bottom of the
FTSE after it flagged a 10 percent revenue drop at Hewlett
Packard Enterprise, the company it's in the process of
acquiring for $8.8 billion.
Mining companies Glencore and BHP Billiton
both rose more than 2 percent as the price of copper edged up
from sharp overnight losses.
Ferrexpo and Kaz Minerals led gains on the
mid-caps as well, up 4.9 and 2.7 percent respectively.
Asset manager Henderson benefited from a UBS
upgrade and rose to join the top mid-cap gainers, up 2.3 percent
and on track for its best day in six months. UBS analysts see
its acquisition of U.S. fund manager Janus as "transformational"
for the firm.
"Significantly enhanced scale, distribution and
diversification see it better equipped to deal with ongoing
headwinds from a gradual global shift to passive (management)
and rising regulatory costs," they said in a note.
Meanwhile the broker's downgrade of Card Factory
to "neutral" after the shares rallied weighed on the stock, down
(Reporting by Helen Reid and Danilo Masoni; Editing by Mark