Britain's FTSE regains ground after turbulent start to the year

* FTSE 100 up 0.1 pct

* Commodity-related stocks gain

* BAE Systems (LSE: BA.L - news) , Standard Life (LSE: SL.L - news) up on upgrades

* Wealth manager St James's suffers from downgrade

By Kit Rees

LONDON, Jan 11 (Reuters) - Britain's top share index advanced on Monday, rebounding from its worst first week of the year since 2000, as commodity-related stocks staged a tentative recovery.

The FTSE 100 ended last week down 5.3 percent as China's moves first to weaken, then to strengthen the yuan rattled global markets.

China guided the yuan higher for a second straight session on Monday, calming investor concerns about how far Beijing wanted to see the currency depreciate.

Investors were left undeterred by weak China data, out over the weekend. The data showed Chinese consumer inflation remained at a subdued 1.6 percent in December and producer prices fell 5.9 percent on the year.

The blue-chip FTSE 100 index was up 0.2 percent at 5,925.03 points by 1005 GMT, steadying after last week's fall, which was the biggest weekly drop since August.

"I think what we're probably seeing is position-unwinding, rather than any real confidence that the stock market is actually going to make a spike higher under current conditions," Brenda Kelly, head analyst at London Capital Group, said.

Mining company Anglo American (LSE: AAL.L - news) gained 2 percent and Glencore (Xetra: A1JAGV - news) was up 1 percent. The sector hit its lowest levels in over 11 years last week.

Some traders said the battered mining companies could shore up their balance sheets through future asset sales, which was prompting bargain hunting.

Defence and aerospace company BAE Systems rose 1.6 percent after investment bank JP Morgan upgraded its rating on the stock to "overweight" from "neutral".

JP Morgan added that it expected 2016 to be a "very good year" for European defence stocks as geopolitical tensions escalated.

Investment savings company Standard Life, up 1.1 percent, also benefited from a broker upgrade. Deutsche Bank (Other OTC: DBAGF - news) raised the shares to "buy" as part of its reshuffle of ratings on the life insurance sector.

Deutsche Bank, however, cut its ratings on Prudential (Amsterdam: PD8.AS - news) and St James's Place to "hold" from "buy". The stocks fell 0.4 percent and 1.5 percent respectively. (Reporting by Kit Rees, editng by Larry King)