* Banks up on Dubai debt move by Abu Dhabi
* Miners, oils lifted by firmer commodity prices
* Whitbread up on bullish trading statement
By Simon Falush
LONDON, Dec 14 (Reuters) - Gains in banks and commodity
stocks lifted Britain's top share index 0.8 percent by midday on
Monday, after Abu Dhabi bailed out neighbouring Dubai with $10
billion in surprise aid, settling investor nerves.
By 1202 GMT, the FTSE 100 was 41.01 points higher at
5,302.58, adding to gains from the previous session when it
ended up 17.20 points, or 0.3 percent.
Investors bought banks as anxiety about their exposure to
Dubai's debt problems eased. Standard Chartered <STAN.L> fared
best, up 3.5 percent, supported too by a Credit Suisse upgrade,
while HSBC <HSBA.L> and Barclays <BARC.L> added 2.1 and 1.1
percent respectively.
Dubai said funds provided by its neighbour Abu Dhabi would
help towards repaying a $4.1 billion Islamic bond maturing on
Monday, while the excess would be used to meet state-owned
conglomerate Dubai World's needs up until the end of April 2010.
[]
"People are focused on the financing from Abu Dhabi and the
effect that it's having on sentiment as it's increasing the
desire for risk," said Henk Potts, analyst at Barclays Wealth.
He added that stronger-than-expected data from the United
States and China last week and relatively low valuations were
also supportive of equities as an asset class.
But Lloyds Banking Group <LLOY.L> lost 1.3 percent as
underwriters offered in the market the rump of the bank's record
rights issue which the group said on Monday had achieved a 95
percent take-up. []
Royal Bank of Scotland <RBS.L>, majority-owned by the state,
also lost 1.3 percent.
However other financial sector shares found support, with
the London Stock Exchange <LSE.L> the top FTSE 100 riser, up 7.6
percent as worries that shareholder Dubai Bourse might have to
sell its stake in the British firm receded.
Insurers Prudential <PRU.L>, Aviva <AV.L>, and Standard Life
<SL.L> added 1.4 to 3.1 percent.
COMMODITIES GAIN
Heavyweight commodity stocks gained too as the demand
picture continued to improve, helped again by last week's solid
data from major consumer China.
Among the miners, Lonmin <LMI.L>, Vedanta Resources <VED.L>,
BHP Billiton <BLT.L>, Anglo American <AAL.L>, Rio Tinto <RIO.L>
and Xstrata <XTA.L> gained 0.8 to 2.3 percent.
Oil majors BG Group <BG.L>, BP <BP.L>, and Royal Dutch Shell
<RDSa.L> added 1.1 to 1.2 percent.
Whitbread <WTB.L> stood out among individual gainers, up 3.4
percent after the hotels to coffee shops operator said in a
trading update that it expected its 2009/10 results to "somewhat
exceed" market estimates. [].
With no significant economic data released in the UK, or due
in the United States on Monday, the macro focus was on the
latest two-day Federal Reserve meeting, which kicks off on
Tuesday, with an interest rate decision due after the London
close on Wednesday.
"No one has a really strong reason to be selling equities at
the moment, and after the recent surprisingly upbeat U.S.
non-farm payrolls (employment) report things could surprise on
the upside for now," said David Morrison, market strategist at
GFT Global.
Among the losers, British Airways <BAY.L> fell 0.7 percent
after the airline said its pension deficit more than doubled to
3.7 billion pounds ($6 billion) at the end of March, but not
seen as big enough to detail a merger with Spain's Iberia
<IBLA.MC>.
The airline is also awaiting the release of the results of a
strike ballot by its cabin crew, due later this afternoon.
[]
(Additional reporting by Jon Hopkins; Editing by Rupert
Winchester)
