U.K. Stocks Advance for Third Day; BHP, AstraZeneca Gain

By Adria Cimino

Oct. 30 (Bloomberg) -- U.K. stocks rallied for a third day as central banks around the world cut interest rates, raising speculation that lower borrowing costs may help revive the financial system and economic growth.

BHP Billiton Ltd., the world's biggest mining company, and Rio Tinto Group advanced. Royal Dutch Shell Plc declined after saying third-quarter crude and natural-gas output fell. Drugmaker AstraZeneca Plc jumped after raising its full-year earnings target.

The FTSE 100 Index gained 74.69, or 1.8 percent, to 4,317.23 at 11:15 a.m. in London, as all but 15 stocks advanced. The benchmark has declined 12 percent this month. The FTSE All-Share Index increased 2 percent. Ireland's ISEQ Index added 0.6 percent.

``Monetary policy will be a support to re-launch the financial machine and the economy,'' Francois Savary, a strategist at Reyl & Cie. in Geneva, said in a television interview. ``It's very positive.''

Central banks in Taiwan and Hong Kong followed China in lowering borrowing costs in an attempt to curb an economic slowdown. Federal Reserve Chairman Ben S. Bernanke signaled he's ready to keep cutting rates should yesterday's half-point reduction in the main rate to 1 percent fail to stem the deepening economic slump.

BHP added 5.5 percent to 1,013 pence. Rio Tinto, the third- biggest mining company, advanced 6.5 percent to 2,851 pence. Anglo American Plc gained 4.1 percent to 1,436 pence.

Shell Declines

Shell slipped 1.6 percent to 1,678 pence. Europe's largest oil company said third-quarter crude and natural-gas output fell 6.6 percent. Total production, including bitumen from oil sands, was 2.93 million barrels of oil equivalent a day. That missed the estimate of 2.95 million barrels of oil equivalent a day, according to a Bloomberg News survey of six analysts.

AstraZeneca jumped 4.4 percent to 2,529 pence. The drugmaker said third-quarter profit gained 28 percent as the company trimmed costs and expanded product sales outside the U.S. The company increased its forecast for earnings per share excluding restructuring and other one-time costs to a range of $4.90 to $5.05 as currency movements boosted the figures.

The following stocks also gained or fell in the U.K. market. Stock symbols are in parentheses.

Hays Plc (HAS LN) climbed 12 percent to 70 pence. Britain's largest recruitment company was added to the ``most preferred'' list at Merrill Lynch & Co.

Luminar Group Holdings Plc (LMR LN) plunged 9.5 percent to 162.5 pence. The U.K.'s biggest nightclub owner reported a first- half net loss of 22.4 million pounds ($37 million).

RSA Insurance Group Plc (RSA LN) slid 2.9 percent to 129.4 pence. Royal Bank of Scotland Group Plc cut its recommendation on the U.K.'s second-largest non-life insurer to ``sell'' from ``hold.''

Standard Life Plc (SL/ LN) sank 3 percent to 194 pence. Scotland's biggest insurer said third-quarter sales fell 9.8 percent, hurt by weakness in the U.K. and Europe.

-- Editor: John Kohut.

To contact the reporter on this story: Adria Cimino in Paris at acimino1@bloomberg.net.