RTRS: FTSE flat weak pharmas offset commodities gain
LONDON (Reuters) - Britain's top shares were flat in early deals on Monday, pausing after five sessions of gains, with weakness in heavyweight pharma stocks countering strength in commodity issues and banks.
By 0910 GMT, the FTSE 100 .FTSE index was 2.37 points lower at 5,356.80, having closed 0.6 percent higher on Friday, its highest closing level in a month, and posting its best weekly performance since July.
"Moves are pretty narrow reflecting a lack of fresh news, with defensives losing out but miners and oils rallying", said Mic Mills, senior trader at ETX Capital.
"With more banking results due later this week, and Greek uncertainties remaining in the background, investors are loath to chance their arm too far on a Monday morning."
GlaxoSmithKline (GSK.L) was the top FTSE 100 faller, down 1.2 percent. Two U.S. drug safety reviewers have recommended that Glaxo's diabetes drug Avandia be pulled from the market after concluding it is more dangerous to the heart than a rival medicine.
Pharma peer Shire (SRP.L) shed 0.8 percent, giving back some of Friday's post-results advance, while AstraZeneca (AZN.L) fell 0.3 percent as the defensive attractions of the sector waned.
Among other weak defensively-perceived issues, drinks group Diageo (DGE.L) lost 0.8 percent, while food retailers Tesco (TSCO.L), Sainsbury (SBRY.L), and William Morrison (MRW.L) shed 0.1 to 0.6 percent.
General retailers were also weak, with Next (NXT.L) Marks & Spencer (MKS.L), and Kingfisher (KGF.L) down 0.6 to 1.2 percent.
MINERS WANTED
Miners provided the underlying support for blue chips as the gold prices moved higher, benefiting from a slip back in the U.S. dollar. Vedanta Resources (VED.L), Kazakhmys (KAZ.L), Antofagasta (ANTO.L), BHP Billion (BLT.L) and Eurasian Natural Resources (ENRC.L) gained 1.2 to 2.2 percent.
Rio Tinto (RIO.L) added 1.4 percent. The global miner said it had started iron ore production at a $901 million mine in the Robe Valley in Australia's Pilbara region.
Xstrata (XTA.L) gained 1.5 percent. Glencore, the Swiss commodities trader, is sounding out potential partners as it prepares to buy back the $2.5 billion Prodeco coalmine owned by Xstrata (XTA.L), The Times said on Monday.
Oil majors were higher as crude prices hovered around $80 a barrel, having hit a six-week high earlier.
BP (BP.L), Royal Dutch Shell (RDSa.L), and Tullow Oil (TLW.L) added 0.1 to 0.3 percent but BG Group (BG.L) lost 0.l percent.
Banks were higher as investors looked ahead to full-year results from part-nationalized Royal Bank of Scotland (RBS.L) and Lloyds Banking Group (LLOY.L) later this week.
Barclays (BARC.L), which posted better than expected earnings last week, gained 1.2 percent, while RBS and Lloyds added 0.9 and 0.4 percent, respectively, and HSBC (HSBA.L) took on 0.3 percent and Standard Chartered firmed 0.5 percent.
Britain's opposition Conservatives announced plans on Sunday to encourage taxpayers to buy shares in banks that were part-nationalized during the credit crunch, presenting this as a "people's bank bonus".
The plans, however, were dismissed by Business Secretary Lord Mandelson as a "silly little gimmick", the Financial Times reported.
Separately, Mandelson said on Sunday that Britain's loss-making, bailed-out banks should be restrained as they decide on bonuses for top executives ahead of reporting their annual results this week.
Among individual blue chip gainers, packaging firm Bunzl (BNZL.L) topped the FTSE 100 leaders board, up 3.3 percent after it posted forecast-busting full-year results.
Tour operators TUI Travel (TT.L) took on 1.8 percent after UK press report said 54 percent shareholder TUI AG is in talks to buy-out and de-list the firm. The German group, however, denied such plans.
No significant data are due for release on Monday in the UK.
