Britain's FTSE steadies, consolidating strong May gains
* Blue-chip FTSE 100 index flat
* Weir gains as Credit Suisse (NYSE: CS - news) boosts forecasts
* Associated British Foods (LSE: ABF.L - news) up on Goldman upgrade
* UK Gfk survey hits other consumer staples
(Adds details)
By Alistair Smout
LONDON, May 29 (Reuters) - Britain's top share index
steadied on Friday, consolidating a strong monthly performance
in May and outperforming European shares, with support from
Associated British Foods and Weir Group after
broker upgrades.
The blue-chip FTSE 100 index was flat in percentage
terms at 7,041.37 by 1321 GMT, up about 1.1 percent this month.
The index has rallied 3.3 percent since lows hit on May 7,
boosted by a decisive Conservative election victory that
investors said removed substantial uncertainties over regulation
and the economy.
The rally has taken the index firmly over the 7,000 level,
where there is also support from the 30-day moving average, to
just 1.2 percent away from an all-time high of 7,122.74 reached
in April.
Traders said positioning for the end of the month helped the
FTSE to recoup early losses.
"As it's the last (trading) day of the month, the fall was
unlikely to be sustained," Zeg Choudhry, managing director of
LONTRAD, said.
"There is still downside potential, but the index managed to
hold 7,000. The longer that holds, the bigger support it
becomes."
Weir Group was among top gainers, up 2 percent after Credit
Suisse raised its target price on the stock and maintained its
"outperform" rating.
Associated British Foods, owner of British Sugar and
budget fashion retailer Primark, rose 2.8 percent to 3,022
pence.
Traders attributed the rise to Goldman Sachs (NYSE: GS-PB - news) lifting its
rating on the share to "buy" from "sell" and increasing its
price target to 3,120 pence from 2,755 pence.
"Our analysis of the U.S. market suggests that Primark's
launch (due in autumn 2015) will be a success," Goldman Sachs
said in a note.
Other consumer staple stocks fell, trimming 5.6 points off
the FTSE 100, with traders saying a weak consumer confidence
survey had dampened sentiment.
A survey from market research company GfK showed optimism
about the British economic situation over the next 12 months
falling to its lowest level since January, while Britons also
become less upbeat about their personal financial prospects.
With the FTSE 100 so near a new record high, the outlook for
stocks may be darkening too.
British investors slashed their equity holdings to a near
three-year low in May, wary of being too exposed to record high
stocks and instead opting for the relative safety of bonds, a
Reuters poll has found.
(Editing by Andrew Roche)