U.K. Stocks Advance, Led by Lloyds, Xstrata; Tullow Oil Drops

By Daniela Silberstein

Feb. 9 (Bloomberg) -- U.K. stocks rose for a second day, led by banks and basic resources shares.

Lloyds Banking Group Plc and Royal Bank of Scotland Plc both gained more than 2 percent. Xstrata Plc led commodity producers higher as metals prices climbed. Tullow Oil Plc slid 1 percent after a Ugandan government minister said he expects a proposal from the explorer this week.

The FTSE 100 Index added 21.79, or 0.4 percent, to 5,114.12 at 9:11 a.m. in London. The FTSE All-Share Index rose 0.4 percent while Ireland’s ISEQ Index fell 0.3 percent.

The benchmark FTSE 100 has retreated for four-consecutive weeks amid mounting concern that Greece, Spain and Portugal will struggle to reduce their budget deficits.

Lloyds gained 2.4 percent to 48.32 pence. RBS advanced 2.5 percent to 32.96 pence. British taxpayers may be able to sell their stakes in Lloyds and RBS in five years, with RBS exiting the government’s asset-insurance program in “two to three years,” a panel of lawmakers reported, citing testimony by Treasury officials.

Xstrata advanced 2.5 percent to 1,008 pence. The fourth- largest copper producer was raised to “outperform” from “market perform” at BMO Capital Markets. Copper advanced as the dollar declined on expectations that European central bankers will help Greece with its fiscal deficit, with the metal extending a rebound from its lowest level in more than three months.

Fresnillo Plc, the world’s biggest primary silver producer, rallied 1.2 percent to 713.5 pence.

Tullow Oil

Tullow Oil dropped 1 percent to 1,147 pence. Uganda expects the U.K. explorer to submit a proposal for a possible partnership to develop oilfields in the nation’s Lake Albert area this week, according to Minister of State for Mineral Development Peter Lokeris.

AstraZeneca Plc gained 1.5 percent to 2,821 pence. The U.K.’s second-largest drugmaker’s widely used cholesterol- lowering drug Crestor was approved by U.S. regulators to prevent heart attacks and strokes.

ICAP Plc rose 1.6 percent to 308.5 pence. The world’s largest broker of transactions between banks was added to Bank of America Merrill Lynch Global Research “Europe 1” list.

Beazley Group Plc gained 1.4 percent to 103.7 pence. The Lloyd’s of London insurer said 2009 profit rose 37 percent to 88.4 million pounds ($138 million) as higher rates boosted revenue while recession-related and catastrophe claims were lower than expected.

British Land Co. Plc rose 1.8 percent to 446 pence. The U.K.’s second-largest real-estate investment trust said it made a profit of 623 million pounds in the fiscal third quarter as the value of its real estate assets rose.

Rightmove Plc added 3.2 percent to 542 pence. The owner of the U.K.’s largest residential property Web site said full year trading is expected to be in line with current market expectations and 2010 profit will be above estimates.

To contact the reporter on this story: Daniela Silberstein in Zurich at dsilberstei2@bloomberg.net.