Britain's FTSE rebounds, fuelled by upbeat earnings

Alistair Smout

* FTSE 100 up 0.7 percent

* BP adds most points after beating expectations

* Index bounces back after biggest fall for three months

LONDON, Feb 5 (Reuters) - Britain's top share index

rebounded on Tuesday from a steep fall in the previous session,

as investors switched their focus from euro zone worries to a

generally solid set of company updates.

At 1137 GMT, the FTSE 100 was up 0.7 percent at 6,287.69, a

day after suffering its biggest one-day fall in three months as

political uncertainties in Europe and a string of analyst

downgrades sparked profit taking from 4-1/2-year highs.

Oil heavyweight BP added more than 5.5 points to the

index after strong fourth-quarter figures.

"The likes of BP have come in and beaten expectations, and

by a comfortable margin too," Alastair McCaig, market analyst at

IG Index, said.

"...The market has pretty quickly shrugged off the

negativity of yesterday. We've been through a month where equity

markets have once again shown their popularity with investors."

In January the FTSE 100 posted its strongest start to the

year since 1989, rising 6.4 percent.

Other corporate results also helped fuel further gains on

Tuesday, with chip designer ARM up 3.7 percent after

fourth-quarter profits that beat expectations.

But oil and gas firm BG fell 2 percent after it said

it would miss 2015 production targets.


The fourth-quarter earnings season in the UK is a third of

the way through, and has so far been mixed, with 50 percent of

the FTSE 100 companies to report so far beating or meeting

expectations as some have struggled with weak growth.

But firms such as BP beating expectations during a fourth

quarter in which the UK economy shrank demonstrates that many

larger companies are resilient to dips in the domestic economy.

"The UK market has lots of quality large multinationals, and

to some extent it has been insulated from what's been going on

in the UK domestically," said Sandra Crowl, investment committee

member at Paris-based asset management firm Carmignac Gestion.

"We have got investments in the UK in chemical companies, in

energy companies, and these companies in particular have got

quite a deal of their revenues coming from outside of the UK."

(Editing by John Stonestreet)