By Dominic Lau
LONDON, March 14 (Reuters) - Britain's leading share index
turned flat by midday on Friday as food retailers weighed after
a bearish Goldman Sachs note, though miners were in demand and
drugmaker Shire <SHP.L> climbed on bid talk.
Shire rose as much as 10 percent before paring gains to
trade up 5.4 percent as traders reported talk of bid interest
from U.S. rival Pfizer <PFE.N>. Shire declined to comment, while
Pfizer could not immediately be reached for comment.
By 1135 GMT, the FTSE 100 <> was down 3.2 points at
5,689.2, after losing 1.5 percent on Thursday.
"We had a very turbulent few days. Markets have been very
volatile. They tried to recover earlier in the week but that was
immediately met by resistance," said Angus Campbell, head of
sales at Capital Spreads.
"We remain firmly in the mid-5,000 level, which is where the
index seems to be in a bit of a comfort zone. It doesn't seem to
want to rally, so the pressure is on the downside at the
moment."
Miners were the standout performers after spot gold <XAU=>
jumped and held within the sight of $1,000 an ounce. Copper rose
nearly 2 percent.
BHP Billiton <BLT.L>, Rio Tinto <RIO.L>, Lonmin <LMI.L>,
Kazakhmys <KAZ.L>, Antofagasta <ANTO.L> and Anglo American
<AAL.L> were up between 0.9 and 1.8 percent.
Xstrata <XTA.L> added 0.4 percent, extending the previous
session's 1.8 percent gain on market talk that Brazil's Vale
<VALE5.SA> had clinched a deal to buy commodity trader
Glencore's stake in Xstrata at 42 pounds a share.
But food retailers took a beating after Goldman Sachs
downgraded its ratings and targets on Tesco <TSCO.L>, Morrison
Supermarkets <MRW.L> and Sainsbury <SBRY.L>.
Tesco shed 3 percent, Morrison Supermarkets fell 5.1 percent
and Sainsbury lost 1.7 percent.
Major European indexes were also weaker by mid-session,
while the dollar edged back from a record low against the euro
and a basket of major currencies.
U.S. index futures slipped as investors geared up for
consumer prices data, due at 1230 GMT, for further clues on U.S.
inflation picture. In Asia, Japan's Nikkei average <> hit
its lowest close for more than two and a half years on Friday.
Rate futures now indicate an 88 percent chance that the
Federal Reserve will cut its benchmark interest rate by a
further 75 basis points at the U.S. central bank's next
rate-setting meeting next Tuesday.
Banks, however, were generally firmer after their recent
battering. Royal Bank of Scotland <RBS.L> put on 0.2 percent,
HBOS <HBOS.L> added 0.7 percent, Lloyds TSB <LLOY.L> gained 0.6
percent and HSBC <HSBA.L> rose 0.6 percent.
International Power <IPR.L> advanced 2.3 percent after
Deutsche Bank upgraded its rating on the stock to "buy" from
"hold".
(Editing by Quentin Bryar)
