FTSE stalls near multi-year highs, earnings news mixed

January 21, 2014

* FTSE 100 flat, near multi-year closing high of 6,840

* Unilever (NYSE: UL - news) jumps on forecast-beating results

* SABMiller (LSE: SAB.L - news) weakens after trading update

By Tricia Wright

LONDON, Jan 21 (Reuters) - Britain's top shares steadied on Tuesday, with Unilever notching strong gains after unveiling robust results, though brewer SABMiller (Berlin: BRW1.BE - news) suffered after a trading update analysts said was uninspiring.

Investors are scrutinising corporate updates for clues as to the likely strength of the quarterly reporting season, and whether it will justify high valuations after a bumper 2013.

Unilever advanced 4.1 percent, shaving its loss over the last six months to around 7 percent, after it unveiled better-than-expected 2013 results.

But brewer SABMiller shed 2 percent after its update which analysts said was in line with expectations, though currency continued to weigh.

"SABMiller was fairly uninspiring in terms of its update, and I think if anything those two together (Unilever and SABMiller) are reflective of what we're seeing in terms of the Q4 reporting season," said Richard Hunter, head of equities at Hargreaves Lansdown (LSE: HL.L - news) .

"There aren't too many companies shooting out the lights at the moment, and in a broader context, it still remains to be seen whether the U.S. and UK economy are strong enough to stand on their own two feet without all the monetary stimulus that we've been seeing."

While the European earnings season is in its nascent stage, in the United States, where 10 percent of S&P 500 firms have reported, 69 percent have met or beaten on revenue, while 58 pct have met or beaten on earnings, Thomson Reuters Starmine showed.

The FTSE 100 was up 2.22 points, although flat in percentage terms, at 6,838.95 points, by 0850 GMT, just shy of a multi-year closing high of 6,840 points hit last May.

Charles Stanley (LSE: CAY.L - news) analyst Bill McNamara said the index was starting to look overbought "but not to the extent that further upside is no longer likely".

"The broader technical picture is still indicating that the UK index has scope for further near-term gains and the next target is, in fact, last year's trading peak, at 6,875."