Britain's FTSE steadies, charts signal gains

LONDON: Britain's top shares steadied on Thursday as stronger miners on the back of a rise in metals prices offset weaker energy shares, brought down by Royal Dutch Shell that fell on worries over a possible oil spill in the Gulf of Mexico.

Charts, however, signaled a rebound in equities in the near term after hitting oversold levels and recovering after touching some important support levels.

Miners gained as copper prices rose further above technical support at $8,000 a tonne as worries over the global economic outlook eased. Rio Tinto rose 3.2 percent, Eurasian gained 2.6 percent, while BHP Billiton was up 1.9 percent.

But energy shares were under pressure. Royal Dutch Shell fell 5.1 percent, the top loser on the FTSE 100 index, after an oil sheen spotted near one of the firm's platforms in the central Gulf of Mexico caused the company to send a spill response vessel and seek aircraft overflights.

The incident, which raised memories of BP's Deepwater Horizon rig disaster in 2010, prompted investors to reduce their trading positions in the sector. BP fell 2 percent, while BG Group was down 0.7 percent.

At 1156 GMT, the FTSE 100 index was flat at 5,630.10 points, having rallied 0.7 percent on Wednesday following a decline of 2.3 percent in the previous session on global growth concerns and as a rise in Italian and Spanish yields raised new worries about the euro zone debt crisis.

Charts showed positive signals in the near term, especially after the FTSE 100 index bounced back in the previous session from a support level of 5,570, which provided a floor for the market in January.

"The index is set for a rebound. Its 9-day RSI (relative strength index) fell into the oversold zone yesterday and coincided with the support level," said Julian McCormack, technical analyst at Brewin Dolphin.

"The main reason why the market is not continuing its gains from yesterday is really the oil and gas sector. But it's not faring too badly, considering the size of the oil and gas sector within the FTSE 100. The bias is more on the upside."

Among some individual blue chip gainers, autos and aerospace parts firm GKN was the top FTSE 100 riser, up 5 percent as Credit Suisse upped its rating to "outperform" from "neutral".

Its shares were also supported by a 47 percent jump in British aerospace parts supplier Umeco Plc after specialty chemicals maker Cytec Industries Inc said it had made an offer valued at about $439 million for Umeco.

Aggreko gained 2.6 percent as the world's biggest temporary power provider said underlying revenue had risen by more than 20 percent in the first three months of the year, putting it on track for further growth in 2012.