* Miners weaker as China clouds demand outlook
* Banks down as Bank of America Q4 disappoints
* Pharmaceuticals boosted by U.S. Democrats poll loss
By Simon Falush
LONDON, Jan 20 (Reuters) - Britain's top share index fell
0.9 percent at midday on Wednesday, with miners weighed by an
uncertain demand outlook in China, and banks weaker after Q4
results from Bank of America disappointed investors.
By 1214 GMT the FTSE 100 <> was down 50.79 points at
5,462.35 having closed up 18.75 points, or 0.3 percent, on
Thursday at 5,513.14.
Sources in China said authorities had instructed major banks
to stop lending for the rest of January after they went on a
lending binge earlier in the month, sending stocks in the region
sharply lower.[]
Commodity prices weakened as the move clouded the demand
outlook, which hit miners. Rio Tinto <RIO.L>, Xstrata <XTA.L>,
Lonmin <LMI.L>, Anglo American <AAL.L>, Kazakhmys <KAZ.L> and
BHP Billiton <BLT.L> fell 3.2-4.6 percent.
Fourth-quarter numbers from Bank of America <BAC.N> did
little to calm investors' nerves, with recent results from
Citigroup <C.N> and JP Morgan <JPM.N> having already
disappointed. []
Morgan Stanley <MS.N> is due to report later in the session.
"The China story is in the market, but we have had mixed
numbers on financials and that's injecting some volatility into
the market," said Peter Dixon, economist at Commerzbank. "There
are question marks over earnings numbers in 2010."
HSBC <HSBA.L>, Barclays <BARC.L>, Standard Chartered
<STAN.L>, Royal Bank of Scotland <RBS.L> and Lloyds Banking
Group <LLOY.L> fell 0.2-2.1 percent.
Among individual fallers, Imperial Tobacco <IMT.L> was the
top blue-chip loser, down 3.3 percent after the stock went
ex-dividend on Wednesday, taking 2.05 points off the FTSE 100
index.
PHARMAS STRONGER
Pharmaceuticals stocks were the main support for the index,
after a Republican win in the U.S. Senate race in Massachusetts
robbed Democrats of the crucial 60th Senate vote needed to pass
healthcare reform.[]
"The odds of major U.S. healthcare reform, or something
that's not to the Republicans liking, is now looking less than
50 percent -- and that's going to help the pharmaceutical
companies," said Jefferies analyst Jeffrey Holford.
AstraZeneca <AZN.L> and GlaxoSmithKline <GSK.L> added 0.6
percent and 1 percent respectively, while Shire <SHP.L> topped
the list of FTSE risers, gaining 3.2 percent, also boosted by an
upgrade to 'overweight' from 'neutral' by JP Morgan.
Some other defensive stocks fared well, with United
Utilities <UU.L>, and Severn Trent <SVT.L> gaining 2 and 1.2
percent respectively.
Cable & Wireless <CW.L> was a strong performer, gaining 2.1
percent after Citigroup upgraded its rating for the telecoms
carrier to "buy" from "hold".
The number of Britons claiming jobless benefit fell by more
than expected in December and by the biggest amount since April
2007, data showed. []
All nine members of the Bank of England's Monetary Policy
Committee voted in January to keep interest rates at a record
low of 0.5 percent and to maintain its 200 billion pound ($326.5
billion) quantitative easing scheme as expected. []
Confederation of British Industry director general Richard
Lambert said on Wednesday the best outlook for the country's
economy was a fragile recovery this year that extended into
2011, in a Financial Times interview. []
(Additional reporting by Ben Hirschler; Editing by Rupert
Winchester)
