* Banks up; Lloyds misses out as KBW cuts target price
* Miners lead rebound; gold hits historical high
* Oils higher as crude rises with weaker dollar
By David Brett
LONDON, Dec 1 (Reuters) - Britain's top share index was up
1.7 percent at midday on Tuesday, with banks and miners topping
the leader board as concerns abated over Dubai's debt problems.
By 1220 GMT the FTSE 100 index was up 90.04 points at
5280.72, having fallen by 55.05 points or 1.1 percent on Monday
to end at its lowest closing level for three weeks.
The blue chip index posted its biggest one-day percentage
fall in eight months last Thursday after Dubai sought a debt
standstill for state-owned conglomerate Dubai World.
Overnight on Monday Dubai World unveiled plans to
restructure about $26 billion in debt out of the estimated total
of $59 billion which it owes, reassuring investors that the
emirate's debt problems can be contained. []
"We're seeing a continuing recovery from that (the Dubai
World worries) and also with the year-end in mind there's a
certain amount of window dressing going on," said Angus
Campbell, head of sales at Capital Spreads..
"Had the U.S. and Middle Eastern markets been open last week
then the reaction wouldn't have been quite so severe," Campbell
added.
Banks were the biggest gainers as recent worries over their
exposure to Dubai's debts eased, with Royal Bank of Scotland
<RBS.L>, HSBC <HSBA.L>, Barclays <BARC.L> and Standard Chartered
<STAN.L> gaining 2 to 4.2 percent.
Lloyds Banking Group <LLOY.L> missed out, losing 1.3 percent
as KBW slashed its target price to 65 pence from 105 pence, as
the bank pushed ahead with its record rights issue, which was
priced last week at 37 pence a share to raise 13.5 billion
pounds. [].
Miners were bolstered by stronger metal prices as the dollar
weakened with investors unwinding moves into the safety of the
U.S. currency made on Dubai concerns.
Eurasian Natural Resources <ENRC.L> was up 4.6 percent
bolstered as well by news of the stock's inclusion on BofA
Merrill Lynch's influential Europe 1 list and by a Credit Suisse
upgrade to "outperform" on Monday.
Xstrata <XTA.L>, Rio Tinto <RIO.L>, BHP Billiton <BLT.L>,
Fresnillo <FRES.L>, Vedanta Resources <VED.L>, and Anglo
American <AAL.L> climbed 1.7 to 5.4 percent higher.
The shareholders of diamond miner De Beers, including 45
percent owner Anglo American, have agreed in principle to a
rights issue to reduce the firm's debt.
Oil majors added their support as crude prices <CLc1> firmed
as well, with BP <BP.L>, BG Group <BG.L>, and Royal Dutch Shell
<RDSa.L> up 1.1 to 2 percent.
PROPERTY FIRMS EYED
Hammerson <HMSO.L> rose 3.5 percent as Morgan Stanley
resumed coverage of the property firm with an "overweight"
stance.
The broker said the market undervalues the company's UK
development prospects. Within the sector, British Land <BLND.L>,
Land Securities Group <LAND.L>, Liberty International <LII.L>
and Segro <SGRO.L> added between 2.3 and 4.1 percent.
Mid cap housebuilder Persimmon <PSN.L> gained 6.4 percent as
Arbuthnot upped its rating on the company to "buy" from
"neutral" on valuation grounds.
Other mid cap performers included pubs operator Greene King
<GNK.L> up 5.4 percent after strong first-half results, with KBC
Peel Hunt prompted to raise its rating to "buy" from "hold".
[]
Fallers were in short supply on the main index. TUI Travel
<TT.L> shed 1.3 percent after its in-line full-year results
failed to live up to high market expectations after a strong run
by the stock ahead of the numbers.
Peer Thomas Cook <TCG.L> also fell 1.3 percent.
Economic data showed British manufacturing activity grew
more slowly than expected in November and there were signs that
the sector's fledgling recovery might have lost some pace.
[]
British house prices rose 0.5 percent in November, the same
as in October, suggesting that a rapid initial rebound from the
five-year low set in February is now slowing, mortgage lender
Nationwide said on Tuesday. []
Later in the session U.S. November ISM Manufacturing data
and October Pending Home Sales numbers are due out.
(Editing by Greg Mahlich)
((david.brett@thomsonreuters.com; +44 207 542 8099; Reuters
Messaging:david.brett.reuters.com@reuters.net))
