* UK blue chip index FTSE up 0.2 pct
* Marks & Spencer among top gainers after results
* But disappointing update hits Kingfisher
* Healthcare stocks provide support, miners weigh
By Danilo Masoni
MILAN, May 24 UK blue chips rose on Wednesday,
helped by gains in Marks & Spencer following results and
stronger healthcare stocks though weaker miners kept a lid on
the British market.
The FTSE rose 0.2 percent to 7,500.04 points by 0959
GMT, while the mid-cap FTSE 250 index was up 0.15
percent, just shy of a fresh record high hit on Tuesday.
Gains were capped by fall in basic resources stocks after a
sell-off in commodities following Moody’s debt downgrade on
China, a big global metals consumer.
"The heavy sell-off in commodities following China's debt
rating downgrade has taken its toll," Ipek Ozkardeskaya, senior
market analyst at LCG, said in a note.
Glencore fell 0.7 percent after saying it had made
an informal approach to U.S. grains trader Bunge to
discuss a "a possible consensual business combination." But
Bunge responded by saying it was not in talks with the mining
and commodities group.
In the same sector, Anglo American fell 0.6 percent
and precious metal miners Randgold and Fresnillo
both dropped more than 1.5 percent.
Marks & Spencer rose 1.8 percent, reversing earlier
losses that followed the release of results showing a 10 percent
drop in earnings and sliding sales in the latest quarter. The
retailer said that in spite of the weaker quarter improving
profit margins and steady market share showed its struggling
clothing business was on the mend.
"We think that consensus profit forecasts (for 2017-18) will
hold fairly steady today, albeit with improving trends in
clothing margins suggesting some potential upside for the year,"
said RBC Europe analyst Richard Chamberlain, who has an
"outperform" rating on the stock.
But a disappointing update hit Kingfisher, which
fell 6.6 percent. The home improvements retailer reported a 0.6
percent fall in first-quarter sales from stores open for more
than a year, due to weak sales in France, where the firm remains
cautious about prospects.
Analyst at UBS had estimated sales from stores open for more
than a year would increase by 1 percent, while analysts at Davy
expected a rise of 0.3 percent.
Engineering firm Babcock fell 2.7 percent after its
full-year results, while Medclinic was also lower after
reporting a 19 percent drop in underlying full-year earnings on
as regulations in the Middle East
Providing support to the FTSE were gains among healthcare
stocks with AstraZeneca and Shire both rising
more than 1 percent.
Among midcaps, TalkTalk was a top faller, down 2.7
percent after Goldman Sachs downgraded the stock to "sell" from
"neutral" on valuation grounds, while Dixons Carphone
rose 4.7 percent after beating fourth quarter trading forecasts.
On the other hand, firmer oil prices gave a little boost to
BP (+0.32%) and Royal Dutch Shell (+0.28%) shares before May
25th OPEC meeting. With the support of Iraq and Russia, the OPEC
is expected to extend the supply cuts by another nine months.
The barrel of WTI trades above $51.40. Resistance is eyed at
(Reporting by Danilo Masoni; Editing by Raissa Kasolowsky)