Banks bolster FTSE

By David Brett

LONDON (BestGrowthStock) – Britain’s top shares gained in midday trade on Wednesday, boosted by banks after the ECB released figures showing a relatively low take-up of funding, and AstraZeneca (AZN.L: ) surged after a U.S. drug patent was upheld.

By 1108 GMT (7:08 a.m. EDT), the FTSE 100 (.FTSE: ) was up 27.23 points, or 0.6 percent at 4,941.45, having closed down 3.1 percent on Tuesday at its lowest close since September 4, 2009.

“Yesterday’s retest of levels at 4,898 may have formed a double bottom which could help the FTSE to bounce higher from here,” said Joshua Raymond, market strategist at City Index.

“Any move higher, however, would need to clear through resistance at 5,050 and if support levels of 4,898 fail to hold, further selling pressure may open the doors for the FTSE to fall lower toward the 4,630 support level.”

Banks rose after the European Central Bank said it lent banks 131.9 billion euros in three-month funds on Wednesday, below expectations, which eased money market tensions and cooled talk of stresses in the European banking sector.

Barclays (BARC.L: ) and Lloyds Banking Group (LLOY.L: ) were the top risers in the sector, up 3.1 and 2.7 percent respectively, with Royal Bank of Scotland (RBS.L: ) up 2.0 percent.

The sector fell on Tuesday over worries about a potential liquidity shortfall of more than 100 billion euros in the financial system, with European banks set to repay 442 billion euros ($545.5 billion) in emergency loans on Thursday.

Elsewhere, AstraZeneca (AZN.L: ) surged 8.9 percent after the drugmaker won a patent trial in the United States involving its blockbuster statin drug Crestor, leading several brokers to upgrade ratings and target prices for the stock.

The news lifted sentiment in the sector, helping GlaxoSmithKline (GSK.L: ) gain 1.4 percent.

BP BOUNCES

BP (BP.L: ) bounced 9 percent as investors picked up shares on the cheap, and with traders citing vague speculation of a possible takeover of the company resurfacing following recent broker comment.

BP is down 52 percent since its oil spill, the worst U.S. environmental accident, began in the Gulf of Mexico in mid-April.

The season’s first Atlantic hurricane is disrupting cleanup of the massive oil spill, delaying plans to boost containment capacity and threatening to push more oily water onshore.

Essar Energy (ESSR.L: ) gained 3.3 percent, helped by recent positive broker comment.

U.S. stock futures pointed to a firmer start on Wall Street following sharp falls on Tuesday, as investors look to the ADP June employment report, due at 1215 GMT, to provide clues for the eagerly anticipated non-farm payrolls, due out on Friday.

June New York ISM data, due at 1230 GMT (8:30 a.m. EDT), and June Chicago PMI data at 1345 GMT will also clarify the .

On the downside, Vodafone (VOD.L: ) shed 1.5 percent as Goldman Sachs substantially lowered its estimates on the mobile telecoms giant to reflect recent currency headwinds, austerity pressures in Europe and mid-term competitive risks.

Man Group (EMG.L: ) was the blue chip top faller down 7.0 percent as the hedge fund manager lost its dividend attractions, with ex-dividend factors also weighing on Alliance Trust (ATST.L: ) and Compass Group (CPG.L: ).

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(Editing by Louise Heavens)

Banks bolster FTSE