LONDON MARKETS: U.K. Stocks Recoup; Miners, Banks Advance

By Sara Sjolin, MarketWatch

LONDON (MarketWatch) -- The U.K.'s FTSE 100 index recouped on Thursday with mining firms in the driver's seat, partly recovering from a sharp selloff the previous day.

The benchmark added 0.2% to 6,639.23 after shaving off 2% on Wednesday.

Miners were among biggest advancers as metals prices rose across the board. Shares of Fresnillo PLC jumped 6%, Randgold Resources Ltd. gained 5.3% and Rio Tinto PLC (RIO) picked up 1.5%.

Banks were also on the rise. Analysts at Exane BNP Paribas pointed out that banking stocks have further to run, arguing that the sector is one of the most attractive value plays in the market with an around 20% further upside to fair value.

Shares of Royal Bank of Scotland Group PLC (RBS) climbed 1.3%, Lloyds Banking Group PLC (LYG) added 1.8% and HSBC Holdings PLC (HBC) rose 1%.

John Wood Group PLC put on 2.3% after Morgan Stanley lifted the oil-services firm to overweight from equal weight and included it as one of the top picks in the sector. Read: Ahead of OPEC meeting, oil-services firms drop on broker downgrade

"We see Wood Group as well positioned, given its asset-light engineering business model, which we expect to continue delivering above cost of capital returns in the midteens out to 2015," the analysts said.

Shares of Rolls-Royce Holdings PLC picked up 1.6% after the aerospace and defense firm said Singapore Airlines Ltd. (SINGY) plans to order 30 Airbus A350-900 aircrafts powered by Rolls-Royce Trent XWB engines.

On a more downbeat note in London, food and sugar firm Tate & Lyle PLC dropped 2.7%, after reporting a decline in fiscal 2013 pretax profit.

Shares of Tesco PLC (TSCDY) shaved off 2% after J.P. Morgan Cazenove cut the supermarket retailer to neutral from overweight, to be more consistent with the "cautious view on the UK food retail market as a whole, of which Tesco represents 30%."

G4S PLC erased 1% after Standard & Poor's Ratings Services cut its outlook on the security-services firm to negative from stable and affirmed the BBB- credit rating.

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