December 21, 2016 / 11:00 AM / in 7 months

FTSE holds close to two-month high

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People walk through the lobby of the London Stock Exchange in London, Britain August 25, 2015.Suzanne Plunkett/File photo

LONDON (Reuters) - Britain's top share index ended little changed on Wednesday after reaching a two-month high, though a rise in Ashtead Group (AHT.L) and bottler Coca-Cola Hellenic (CCH.L) provided support.

The FTSE 100 was flat at 7,041.42 points at its close, with trading volume low.

The index had touched a fresh two month high in early deals, having posted its highest close since October 11 in the previous session.

Coca-Cola Hellenic (CCH) (CCH.L) was up 1.3 percent after Coca-Cola (KO.N) bought a majority stake in an African bottling firm from AB InBev (ABI.BR) for $3.15 billion (2.55 billion pounds).

Coca-Cola said it planned to hold all operations temporarily until they can be refranchised to other partners. Its existing bottling partners include Coca-Cola European Partners and Coca-Cola Hellenic.

Analysts said that CCH was well positioned to secure the bottling rights due to its experience in Africa, and that the deal looked like good value, coming in under expectations of $4 billion or more.

Shares in Ashtead (AHT.L) climbed 1.3 percent after Credit Suisse raised its target price for the stock, citing a boost for the stock from its U.S. exposure.

"We raise our FY18E and FY19E estimates ... reflecting a stronger demand outlook in the wake of the U.S. presidential election, along with some assumed benefit of a falling effective tax rate on the group's dominant US activities," analysts at Credit Suisse said in a note.

Oil & gas stocks .FTNMX0530 retreated 0.1 percent, with Royal Dutch Shell (RDSa.L) down 0.4 percent after oil prices edged lower on a surprise build in U.S. crude inventories. [O/R]

Falls on the FTSE 100 were broad-based, with fund firm Hargreaves Lansdown (HRGV.L) down 3 percent, health care stock Hikma (HIK.L) down 1.4 percent and Merlin Entertainments (MERL.L) dropping 1.2 percent.

Capita (CPI.L) fell after Goldman Sachs cut its target price on the stock to 595p from 771p, but recovered some of its losses to end 0.7 percent lower.

The investment bank said it expected free cash flow to decline around by about 3 percent each year for the next two years following Capita's recent trading update. Earlier in the month the company gave its second profit warning in three months.

"In general, we see risks that the company's restructuring plan will not address the major concerns we have about bidding process and increasing cyclicality of the business model," analysts at Goldman Sachs said in a note, reiterating a "neutral" rating on the stock.

Among mid-caps, QinetiQ (QQ.L) was up 4.4 percent after it agreed to buy Meggitt's defence business. Liberum said the deal would enhance QinetiQ's position in global test and aviation sectors.

Reporting by Alistair Smout and Kit Rees; Editing by Alison Williams

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