FTSE led higher as Compass Group, oil companies gain

LONDON: Britain's top share index rose on Thursday, supported by gains in Compass Group and Standard Chartered and a rally in the price of oil.

Caterer Compass Group was the top gainer, rising 2.6 percent after brokers RBC Capital Markets and Natixis raised their target prices for the stock.

The gains recouped losses from the previous session after the company posted results.

"H1 results highlighted the high growth and resilience of the Compass business model. Whilst the stock has performed strongly, we believe the premium valuation is warranted.

Compass remains a sound equity story in our view," Andrew Brooke, an analyst at RBC Capital Markets, said in a note. J.P.Morgan's upgrade of its target price upgrade for Standard Chartered helped the bank's shares rise 2.3 percent.

It cited the bank's capital progress in the first quarter.

The FTSE 100 index rose 0.4 percent to 6,186.36 points by 1123 GMT, remaining steady after the Bank of England decided to keep interest rates unchanged.

Packaging and paper company Mondi was up 1.9 percent after reporting first-quarter underlying profit rose 14 percent on strong performances in consumer packaging and uncoated fine paper and better sales in South Africa .

A rise in oil prices boosted shares in oil & gas majors Royal Dutch Shell and BP, which both gained around 1.4 percent, adding 7 points to the index collectively.

Companies trading ex-dividend fell, however. Among them were Britain's largest energy supplier, Centrica, which was down 2.3 percent.

Sainsbury's, GlaxoSmithKline and Morrisons were also down 0.4 to 2.3 percent.

ITV slipped 1.3 percent, taking this month's losses to around 5.6 percent.

The commercial broadcaster said companies were holding back from buying advertising before next month's referendum on whether Britain should remain a member of the European Union, prompting it to lower its forecast for first-half ad revenues.

"In periods of economic uncertainty, advertising budgets are usually the first to fall foul of spending cuts as companies become less certain on prospects," said Richard Hunter, head of research at Wilson King Investment Management "This uncertainty, coupled with the broader debate on the future of free-to-air broadcasting, has resulted in the shares missing out on the recent market recovery."