* FTSE 100 gains 0.1 percent
* BG Group leads oil and gas sector up
* Utilities gain from softer regulator stance
* Johnson Matthey hit by weak outlook
LONDON, Nov 21 (Reuters) - UK shares rebounded from early
falls for the second session in a row on Wednesday, with a
rising oil price supporting energy stocks to lead British blue
The FTSE 100 index gained 3.93 points, or 0.1
percent, to finish at 5,752.03 points in thin trade of only 85
percent of the average 90 day volume.
Energy stocks added 5 points to the index, supported by a
spike in the oil price, which gained more than $1 after a bomb
blast in Tel Aviv threatened to derail hopes for a truce between
Israel and Palestine and raised the prospect of a wider regional
"We have seen in the last couple of hours people coming in
for the energy names, albeit in low volumes," Steve Asfour, head
of sales trading at Fox Davies Capital, said.
"It's probably a read-across from the oil price spike and
there's some really depressed oil and gas stocks really coming
back into play."
One such stock was BG, which led FTSE 100 gainers,
rising 2.8 percent. The gas company had shed over a quarter of
its value in less than a month after forecasting no growth in
2013 in a trading update.
Utilities also supported the rise, led by a 1.9 percent rise
in United Utilities after a clarification by sector
regulators struck a more conciliatory tone.
"The softening of Ofwat's stance on a Competition Commission
referral reduces the near-term risk of negative newsflow and
highlights how important a consensus driven outcome is to this
process," JPMorgan said in a note.
Johnson Matthey lost 5.8 percent in heavy volume of
over three times its average 90 day volume. The precious metals
and commodity company fell after cautioning over an outlook
dented by weakness in both the United States and Europe.
Basic materials also suffered, with miners losing 0.5
percent as growth worries hit commodity prices.
The copper price fell 1.3 percent as the Federal
Reserve chairman cautioned over the prospect of growth in the
United States given tricky fiscal negotiations, and Greece's
international lenders failed to agree on an aid package for the
European finance ministers are to meet again about Greece on
Monday. Price moves and volumes were capped, with the U.S.
Thanksgiving holiday beginning tomorrow meaning that progress on
both fronts is likely to be delayed until next week at the
"It appears from the price action we've seen early on that
we're stuck in a tight range, probably until Monday," said Clive
Lambert, technical analyst at FuturesTechs.
"From a technical point of view, we had a very strong
session on Monday, following on from a rejection of the downside
on Friday. But the price action of yesterday and today is quite
uninspiring, and it doesn't look like we're going to head back
up towards 5,900."
UK stocks dropped 3 percent last week but their losses were
mostly reversed on Monday in the joint biggest single session
rise of the year.
(Editing by Stephen Nisbet)