* FTSE 100 up 0.6 pct
* Oil shares gain with crude near record high
* Miners fall along with weaker metal prices
* Carphone Warehouse up after Goldman rates "buy"
By Dominic Lau
LONDON, July 7 (Reuters) - Britain's top share index edged
up by midday on Monday, recovering part of the previous
session's sharp losses, as near record oil prices boosted energy
stocks, though miners tracked weaker metal prices.
By 1033 GMT, the FTSE 100 <> was up 33.5 points at
5,446.3 after losing 1.2 percent on Friday. The UK benchmark
index ended 2.1 percent down last week, marking its seventh
straight week in retreat.
The FTSE 100 has fallen 15.6 percent so far this year.
"We've got a bit more of a shakeout to do. We haven't closed
below the 20 percent sort of officially bear market level in the
UK," said Martin Slaney, head of derivatives at GFT Global
Markets.
"We have traded below it -- it's certainly an important
milepost being reached and interesting to see if we do close
below that level this week, which is around the 5,401 sort of
level."
Oil shares were in demand as crude prices <CLc1> hovered
near $143 a barrel. BP <BP.L> and Royal Dutch Shell <RDSa.L>
both advanced 2.2 percent, and gas producer BG Group <BG.L>
gained 2.7 percent.
Miners, however, were the biggest drag on the index, with
BHP Billiton <BLT.L>, Xstrata, Rio Tinto <RIO.L>, Vedanta
Resources <VED.L>, Lonmin <LMI.L> and Anglo American <AAL.L> off
between 0.3 and 3.3 percent.
Carphone Warehouse <CPW.L> topped the FTSE 100 gainers, up 5
percent after Goldman Sachs rated Europe's biggest independent
mobile phone retailer a "buy".
Within the retail sector, Marks & Spencer <MKS.L> remained
weak, down 4.1 percent, as analysts continued to cut their
forecasts and price targets after last week's profit warnings
and on fears Chairman Stuart Rose will face a rebellion at
Wednesday's shareholder meeting.
Supermarket group Sainsbury <SBRY.L> strengthened 2.4
percent after JPMorgan upgraded the food retailer to
"overweight" from "neutral". However, Tesco <TSCO.L> fell 1.9
percent and Morrison Supermarkets <MRW.L> slipped 0.3 percent.
Banks were mixed, with HSBC <HSBA.L>, HBOS <HBOS.L>,
Barclays <BARC.L> and Standard Chartered <STAN.L> up. But Royal
Bank of Scotland <RBS.L> shed 4.1 percent and mid-cap Bradford &
Bingley <BB.L> slumped 13.5 percent to touch a new record low of
43 pence.
British Airways <BAY.L> bounced 2.8 percent after losing 5.7
percent on Friday and after rival Air France KLM <AIRF.PA>
reported a 2.6 percent rise in June passenger traffic.
Budget airline EasyJet <EZJ.L>, which reported a 19.5
percent increase in June passenger traffic, was up 2.5 percent.
Also on the upside, AMEC <AMEC.L> climbed 2.7 percent after
Citi upgraded the engineer and project manager to "buy" from
"hold".
WEAK OUTLOOK
"I am enjoying the dead cat bounce and believing none of
it," said David Buik of Cantor Index. "We haven't had a piece of
good news for three months.
"We are eagerly awaiting figures from Alcoa <AA.N> and GE
<GE.N> just to see, as two bellwether stocks from the United
States, how bad things are," Buik said, adding that investors
also would keep an eye on the Bank of England's interest rate
decision on Thursday.
Official data showed British industrial output fell much
more than expected in May, raising the possibility that economic
growth was near standstill in the second quarter.
Mid-cap Persimmon <PSN.L> lost nearly 4 percent after the
Daily Telegraph said the housebuilder would confirm on Tuesday
that it has made 1,000 staff redundant.
The housebuilding sector, whose shares have been battered by
falling house prices and a weaker growth outlook, remained under
pressure, with Taylor Wimpey <TW.L>, Redrow <RDW.L>, Bovis Homes
<BVS.L> and Bellway <BWY.L> off between 2.8 and 9.7 percent.
(Additional reporting by Atul Prakash; editing by Rory
Channing)
