STOCKS NEWS EUROPE-Headlam lifted by KBC Peel Hunt upgrade

Shares in Headlam (HEAD.L) gain 6 percent as KBC Peel Hunt ups its rating for the floor coverings firm to "hold" from "sell" as the stock had fallen back to its unchanged 275 pence target price.

The broker says, in a note, that aside from valuation factors, it also expects newsflow for Headlam to improve, particularly given the easy comparatives in the first-half of 2010. Headlam is scheduled to issue an interim management statement on January 19.

KBC Peel Hunt says it believes Headlam's shares are now reasonably rated, though it continues to prefer peer Carpetright (CATVU.L). Carpetright shares are down 2 percent.

Reuters Messaging rm://jon.hopkins.reuters.com@reuters.net