By David Brett LONDON, Nov 20 (Reuters) - Britain's top share index rose 0.6 percent in early trade on Friday as commodity and banking stocks led a broad-based rally By 0900 GMT, the FTSE 100 was up 30.65 points at 5298.35 after closing down 74.43 points at 5267.70 on Thursday, its biggest one-day fall for three weeks. 'Yesterday we saw profit taking in sectors that have led the recovery but reasonably upbeat leading indicators from the U.S. have calmed the nerves and yet again we have buyers on the dip,' said Jim Wood-Smith, head of research at Williams de Broe. Miners, the biggest drag on the index on Thursday, rebounded as metal prices rallied. Fresnillo, Xstrata, Rio Tinto, Antofagasta, Anglo American and Vedanta Resources rose 0.1-2.4 percent. The mining sector is up 95 percent this year compared to a 19 percent gain for the FTSE 100. Energy issues were on the front foot as the price of crude nudged higher. Royal Dutch Shell, Cairn Energy , Tullow Oil and BP were up 0.5-1.5 percent. BG Group gained 1.6 percent as UBS upped its target price to 1,120 pence from 1,060 pence. Banks were higher as risk appetite returned. Europe's largest bank HSBC gained 0.7 percent, while Barclays , Standard Chartered, Lloyds Banking Group and Royal Bank of Scotland rose 0.1-1 percent. 'The FTSE is likely to hit 5,500 fairly shortly and once it gets past that level there's every chance it is going to get to 6,000. If the western markets are going to falter the trigger will be from the east (China tightening fiscal policy),' said Wood-Smith. The FTSE is up 60 percent since hitting six-year lows in March but is still 2.2 percent below its level prior to collapse of Lehman Brothers bank in September 2008. DRINKS FIRMS HIGHER SABMiller extended Thursday's gains, rising 0.7 percent as a raft of brokers upgraded their target price for the world's No. 2 brewer, after the company reported its first-half results in the previous session. Diageo Plc, the world's biggest spirits group, added 0.3 percent. Defensive issues also made gains as tobacco giants British American Tobacco and Imperial Tobacco climbed 0.8 percent and 0.7 percent respectively. Pharmaceuticals rose, AstraZeneca, GlaxoSmithKline and Shire were up 0.7-1.3 percent. Cable & Wireless was up 2.4 percent after JPMorgan upgraded the stock to 'overweight' from 'neutral' and increased its target price. On the downside, Thomas Cook and TUI Travel shed 4 percent and 2.2 percent respectively, the two top fallers on the FTSE 100 after Morgan Stanley downgraded its rating for the travel companies on a weak operating environment. In the United States, data due to be released include the Economic Cycle Research Institute's Weekly Leading Index, a measure of future U.S. growth, due at 1530 GMT. (Editing by Dan Lalor) Keywords: MARKETS BRITAIN STOCKS (david.brett@reuters.com. +44 20 7542 8099) Reuters Messaging: david.brett.reuters.com@reuters.net)

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