By Sara Sjolin, MarketWatch
LONDON (MarketWatch) -- U.K. stocks were on track for a ninth
straight day of gains on Tuesday, with Severn Trent PLC soaring
after bid news, while miners added pressure after a sector
downgrade.
The FTSE 100 index inched 0.1% higher to 6,635.92.
Shares of Severn Trent jumped 14%, after the water-utility firm
said it received a "very early stage" bid approach, although no
proposal has been made.
United Utilities Group PLC tracked Severn Trent higher and
gained 3.5%.
Mining firms, however, added pressure in Europe, after Barclays
cut the European mining sector to negative from neutral.
"In the longer term we believe the building blocks that made up
the supercycle are gently being removed. Supportive Chinese
demographics, investment led economic growth and availability of
easy credit, lack of investment in mine supply, and difficulty in
bringing it to market are all now either leveling out or
reversing," the analysts said in a note.
"In the second half, fear is likely to become reality with
[about] 70% of the additional volume of iron ore and copper
scheduled for 2013 arriving in the next six months. It is happening
when the broader demand picture is deteriorating and Q3 is a
seasonal soft time for metals markets," they added.
Specifically, Barclays cut Rio Tinto PLC (RIO) to equal weight
from overweight, sending the shares 2.1% lower. Vedanta Resources
PLC was also lowered to equal weight, its shares falling 2.3%.
Eurasian Natural Resources Corp. dropped 1.6% and Anglo American
PLC fell 3.3%. Metals prices were mostly lower.
TUI Travel PLC slipped 1.3%, after J.P. Morgan Cazenove cut the
holiday firm to neutral from overweight.
Babcock International Group PLC put on 6.1%, after the
engineering support-services firm reported a rise in fiscal
full-year pretax profit and said it sees strong progress this
year.
BG Group PLC added 3.3%, after the energy firm said it is
shifting focus back to exploration and liquefied natural gas, while
cutting back spending on big developments.
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