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* FTSE 100 trades flat
* Mining stocks track metals prices
* Energy shares down as oil slips
By Atul Prakash
LONDON, Feb 8 Britain's top share index steadied
on Wednesday, underperforming European peers, with a drop in
energy stocks on the back of weaker oil prices offsetting a
mining sector rally.
The blue-chip FTSE 100 index was flat in percentage
terms at 7,188.20 points by 1006 GMT, after closing marginally
higher in the previous session. In contrast, the pan-European
STOXX 600 index was trading 0.6 percent higher.
Rio Tinto rose 1.8 percent after the world's No. 2
iron ore miner beat profit forecasts on the back of cost-cutting
and a strong recovery in iron ore prices and said it will pay a
bigger-than-expected annual dividend.
"All the dials seem to be moving in the right direction at
Rio, mainly thanks to the self-help measures implemented by the
company," Hargreaves Lansdown analyst Laith Khalaf said.
"Mining companies are price-takers, and have no control over
commodity markets, but Rio has made ground by cutting cash costs
and scaling back the dividend."
Rio shares have more than doubled since early 2016.
The UK mining index rose 1 percent, also
supported by a 1.5 percent-1.6 percent rise in Antofagasta
, Anglo American and Glencore shares.
Rolls-Royce rose 2.6 percent to 718 pence, making it
the top gainer in the FTSE 100, after JP Morgan raised its
target price to 740 pence from 730 pence and increased its 2016
earnings per share forecast by 11 percent.
However, gains were negated by weaker energy stocks.
The UK oil and gas index fell 1.3 percent,
making it the biggest sectoral decliner, after oil prices
extended Tuesday's falls following a massive increase in U.S.
fuel inventories and a slump in Chinese demand.
"Energy shares have been weighed on by a surprisingly large
U.S. API oil inventory build stoking fears that rising U.S.
shale production will outweigh OPEC cuts deigned to rebalance
the global oil market," Accendo Markets analyst Henry Croft
Shares in Royal Dutch Shell and BP fell 1.6
percent and 0.5 percent respectively, while mid-cap Tullow Oil
was nearly 5 percent down.
(Editing by Louise Ireland)