* FTSE down 0.3 pct
* MidEast, N.Africa political unrest dents confidence
By David Brett
LONDON, Feb 21 (Reuters) - Britain's top share index dipped
on Monday as concerns over political unrest in major
oil-producer Libya weighed on sentiment, prompting a flight from
risk and pressuring commodity stocks.
By 1154 GMT, the FTSE 100 <> index was down 17.37
points, or 0.3 percent, at 6,065.62, hovering near recent
32-month highs, with the U.S. market closed on Monday for the
Presidents Day holiday.
Losses were capped, however, as investors fought a
tug-of-war between the growing conviction in the outlook for the
global economy and concerns over unrest in Libya and the wider
North Africa and Middle East region.
"Tactically, bond markets are due a rebound and equity
markets might see a little profit-taking," Mike Lenhoff, chief
strategist at Brewin Dolphin, said.
"However, improving fundamentals are likely to push bond
yields higher and deliver the earnings to support the
momentum underlying equity markets."
Energy stocks <.FTNMX0530> fluctuated as crude oil <CLc1>
rose 2 percent on fears that the political unrest could disrupt
oil supplies. []
"The situation is a tough one near term and does create
uncertainty, but can be seen in a positive light as we're
potentially going from a series of dictatorships to democracy,"
Keith Bowman, an analyst at Hargreaves Lansdown, said.
BP suspended preparations for exploratory drilling for oil
and gas in western Libya due to growing unrest in the north
African country. []
BP also agreed to buy a 30 percent stake in 23 oil and gas
blocks owned by Reliance Industries <RELI.BO>, India's most
valuable listed conglomerate, for $7.2 billion. []
BANKING PROFITS
Banks <.FTNMX8350>, which rose 2.3 percent last week after
solid results in the sector including from Barclays <BARC.L>,
were the biggest fallers. UK banks have risen around 10 percent
since the start of the year.
Royal Bank of Scotland <RBS.L>, which reports later this
week, was down 2.2 percent.
Minutes from the Bank of England's rate setting meeting are
due out on Wednesday, with investors looking for clues as to how
close the voting was for a rise in interest rates.
"We suspect a rate hike will have limited impact on the
overall equity market," Nomura analysts said in a note, adding
rate rises look set to begin in May.
Miners <.FTNMX1770> fell as investors risk appetite faded
and after Beijing on Friday raised banks' required reserves by
50-basis points, showing no let-up in a campaign to combat
inflation. []
Precious metal miners Fresnillo <FRES.L> and Randgold
Resources <RRS.L>, however rose 5.2 and 3.2 percent respectively
as gold climbed to a seven-week high as spreading unrest in the
Middle East burnished the metal's appeal as a safe haven.
Centamin Egypt <CEY.L> was up 6.4 percent after the company
said a sit-in protest of workers at its flagship Sukari gold
mine was minor. []
Invensys <ISYS.L> rose 4 percent after the Observer
newspaper reported on Sunday the British engineering firm is
being eyed as a potential takeover target by several
international rivals, citing "city sources". []
Anglo-French mall owner Hammerson <HMSO.L> added 4.3 percent
after posting a 17.6 percent rise in full-year net asset value.
Mid-cap chipmaker CSR <CSR.L> fell 7.4 percent after it
agreed to buy U.S group Zoran Corporation <ZRAN.O>.
Ocado <OCDO.L> shed 6.6 percent following management share
sales and worries of increased competition from Waitrose.
(Editing by Erica Billingham)
