LONDON (AFP) - Leading shares closed just above the gain line, after US indices regained some earlier losses and mining blue chips lent support, dealers said.
At the close of trade, the FTSE 100 was up 1.0 point at 4,617.4, after falling as low as 4,592.2 around midday.
The rest of the FTSE indices also closed with gains.
Volume was solid with 2.3889 billion shares changing hands in 230,838 deals.
Over in New York, the Dow Jones Industrial Average was down just 0.31 points at 9886.62, while the Nasdaq composite was up 9.4 points at 1,942.71.
US blue chips bounced off lows as oil prices stabilised and eBay's strong third quarter earnings report fuelled a rebound in technology shares.
December crude was down 11 cents at 54.30 US dollars in morning trading in New York
Meanwhile, the latest economic data offered mixed signals on the current health of the economy.
Although the US index of leading economic indicators fell by 0.1 percent in September, the decline was smaller than the consensus forecast of Wall Street economists, who had expected a 0.2 percent fall.
There was better news on the employment after the latest weekly jobless claims hit a six-week low.
First-time seasonally adjusted claims for state unemployment benefits fell by 25,000 to 329,000 in the week ending October 16, the Labour Department said.
In London, mining stocks advanced, following a poor performance on Wednesday and following a solid third quarter production report from BHP Billiton.
BHP rose 8-1/2 pence to 567-1/2, Rio Tinto up 29 at 1,450 and Xstrata rose 21 at 874.
Among pharmaceuticals, AstraZeneca surged 44 pence to 2,218 on relief that its third quarter results contained no nasty surprises, said dealers.
Merrill Lynch reiterated its 'buy' recommendation on AstraZeneca, arguing that the results reinforced its view that the drug group does not need Exanta to deliver premium earnings growth.
The main feature of the results according to analysts is the better-than-expected sales of AstraZeneca's cholesterol treatment Crestor.
Morrison Supermarkets topped the FTSE leaderboard, up 28-1/2 at 222-3/4, as analysts welcomed today's interim results, in particular the company's decision to speed up the conversion of its ailing Safeway outlets.
House broker ABN Amro advised clients to buy the shares, saying: "We detect no longer-term issues and our confidence is high."
Earlier today Morrison said with sales having surged 13 percent at those Safeway outlets it has already transformed, it will step up the rate of conversions to four a week from three previously.
The news helped make Morrison the most popular issue with 183 million shares being exchanged.
This was followed by Vodafone which saw 118 million shares changing hands.
News and financial information provider Reuters was the second biggest riser of the day, gaining 4.31 percent to finish at 363 pence.
The airline sector was back in favour today after Citigroup revised its ratings and targets across the sector ahead of the third quarter results season.
Citigroup said British Airways, up 3-3/4 at 208-1/4 was its preferred pick among the flag carriers and added it was upgrading discount airline Ryanair, up 0.05 at 3.7, to 'buy'.
Bid speculation swirled around Easyjet, helping the stock to gain 4-3/4 at 131.
Traders said there are spurious rumours of a bid for Easyjet from Ryanair. One Northern Irish dealer argued that Ryanair CEO Michael O'Leary recently said that his company might have considered it but for the fact that easyJet has Airbus aircraft and they have Boeing.
O'Leary would apparently be very eager to avoid a dual fleet situation.
In the beverages sector, Scottish and Newcastle featured among the top blue chip gainers, up 9-1/4 pence at 874 after Merrill Lynch raised its rating to 'neutral' from 'sell'.
The US broker said it feels the drinks company is an 'increasingly safe haven' as it marginally cut its full year 2004 EPS estimates by 0.5 percent to 29.4 pence, but left its 2005 estimates unchanged.
But on the downside, Allied Domecq remained a casualty, shedding 4-1/4 pence to 486-3/4 after solid third quarter results failed to inspire buyers.
Merrill said it thinks the results are generally in line with expectations, though by division, Europe is stronger than anticipated with North America and wine weaker.
Merrill argued that strong organic performances and encouraging news in Korea suggests any changes to forecasts will be mildly positive, but the broker doubted it will be enough to provide headroom for a change to the 'neutral' recommendation.
Water supplier Severn Trent topped the FTSE 100 fallers board, losing 1.63 percent to end on 904-1/2 pence.
Financial stocks proved once again to be a burden, with Prudential falling another 5-3/4 pence to 386-1/4 -- making it the second biggest faller of the day.
Prudential's 1 billion pounds rights issue has prompted a flurry of negative reactions from analysts and fears of a widening of the Spitzer probe into the insurance industry has added to investors' concerns.

10-21-2004, 16h52