U.K.’s FTSE 100 Fluctuates; Easyjet Rises, Mining Stocks Fall

By Sarah Jones

Jan. 21 (Bloomberg) -- U.K. stocks fluctuated between gains and losses as a rally in United Utilities Plc and airline companies offset a selloff in mining shares and an unexpected rise in American jobless claims.

United Utilities Plc surged by the most in ten months on the company’s outlook. EasyJet Plc gained on higher revenue and passenger numbers and British Airways Plc also advanced. Anglo American Plc fell 2.6 percent, leading a gauge of mining shares lower for a second day as copper erased gains in London.

The benchmark FTSE 100 Index rose 4.79, or less than 0.1 percent, to 5,425.59 in London at 2:00 p.m. The gauge earlier rallied as much as 0.9 percent and fell as much as 0.4 percent. The FTSE All-Share Index gained 0.1 percent and Ireland’s ISEQ Index added 0.1 percent.

Stocks pared earlier gains after the U.S. Labor Department said more Americans than anticipated filed claims for unemployment benefits last week, reflecting a backlog of applications from the year-end holidays. Initial jobless claims rose by 36,000 to 482,000 in the week ended Jan. 16, the highest level in two months, from 446,000 the prior week. The jump was due to an “administrative” accumulation from late December and early January holidays, and did not reflect “economic” reasons, a Labor Department spokesman said.

United Utilities

United Utilities jumped 4.7 percent to 532.5 pence, the highest level since February last year, as Britain’s largest publicly traded water company said it’s confident of delivering a “sound underlying” performance for the year to March 31. The company also described its balance sheet as “robust.”

EasyJet rallied 4.7 percent to 382 pence after Europe’s second-biggest airline reported an 11 percent rise in first- quarter revenue to 608 million pounds ($984 million) and a 9 percent rise in passenger numbers to 11 million, beating internal forecasts. Chief Executive Officer Andy Harrison also predicted an improvement in earnings for the full year ending Sept. 30.

British Airways, Europe’s third-largest airline, climbed 4 percent to 210.3 pence. Ryanair Holdings Plc gained 1.3 percent to 3.44 euros in Dublin.

Enterprise Inns Plc surged after the company said the rate of decline in profit across its pub estate has slowed. The U.K.’s second-biggest pub owner reported a 4 percent fall in net income per pub in the 16 weeks ended Jan. 16. That compares to an 8 percent decline in the financial year that ended last September. The stock surged 21 percent to 114.5 pence, the biggest advance since October.

Mining Stocks

Anglo American paced declining shares, falling 2.6 percent to 2,582 pence, as copper pared gains in London. Rio Tinto Group, the world’s third-largest mining company, slid 2.3 percent to 3,385.5 pence. Kazakhmys Plc retreated 2.9 percent to 1,322 pence.

A gauge of mining shares yesterday dropped by the most since Nov. 26 amid concern China may rein in stimulus measures to prevent the economy overheating.

The nation’s chief banking regulator, Liu Mingkang, said in an interview that some banks have been asked to limit lending after they failed to meet certain requirements. A report today showed China’s economy expanded 10.7 percent in the fourth quarter from the same period a year ago, the fastest pace since 2007.

To contact the reporter on this story: Sarah Jones in London at sjones35@bloomberg.net.