LONDON: UK shares extended gains for a second session on Friday, boosted by a rally in commodities stocks and hopes of a profit recovery in publisher Pearson , though Royal Bank of Scotland reported its eighth full-year loss in a row.
RBS shares plunged more than 9 percent and were set for their biggest daily loss since June 2012.
The state-backed bank posted a full-year loss of 1.97 billion pounds ($2.75 billion) as it continues to be weighed down by restructuring and litigation costs.
"Despite better progress on capital, RBS has reported a disappointing set of numbers with both revenue and costs light due to weak investment bank performance," analysts at Jefferies said in a note.
It has not turned a profit since its 2008 government bailout during the financial crisis.
"This morning's final numbers give little indication that we have reached a turning point for the bank and ... the main question being asked is how much more money is going to be poured into this never-ending black hole," wrote Michael Hewson, chief market analyst at CMC Markets.
RBS's woes did not off-set broader gains on the FTSE 100 index, which rose 1.3 percent to 6,088.01 points by 0925 GMT, set for its second weekly gain in a row.
"You also get the feeling that a lot of the downside has been factored in ... we're seeing short positions being closed out and new longs being established, but whether that upward trend will last -- it remains to be seen," Manoj Ladwa, head of trading at TJM Partners.
Mining stocks led the index higher, with Glencore, BHP Billiton and Rio Tinto all up between 4.1 percent and 6.2 percent after the price of copper firmed on Friday with the focus shifting to a G20 meeting in Shanghai.
Education and media company Pearson plc was also among the top risers, jumping 4 percent after posting results in line with analysts' expectations, and saying that its restructuring should deliver profit at or above 800 million pounds in 2018.
Burberry Group benefited from a broker upgrade from Nomura, rising 3.9 percent after Nomura upgraded its rating on the stock to 'buy'.
"Since Burberry announced a review of the global market, its initiatives, efficiency programmes, productivity and capital allocation, expectations have risen in anticipation of change," analysts at Nomura said in note.
"We see potential for a greater valuation if Burberry can successfully drive productivity measures, while being more disciplined on cost and capital allocation."
Sports Direct fell 2.6 percent after Britain's biggest sportswear retailer said it was facing higher borrowing costs after deciding it will no longer use a loan facility provided at favourable rates by billionaire founder Mike Ashley.
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