Barroso comments help UK8217;s FTSE

The UK benchmark index was up 10.61 points,at 5,184.86,having gained 0.9.

Britain8217;s top shares recovered from early weakness on Wednesday after comments from European Commission President Jose Manuel Barroso suggesting new moves to alleviate the euro zone debt crisis.

Barroso said the commission will soon present options for the introduction of euro area bonds,though he warned financial markets would only trust that the euro zone can resolve the crisis when it shows that it can deliver on its commitments.

Banks ,normally the most sensitive to the twists in the euro zone debt story,turned positive,led higher by Royal Bank of Scotland ,up 1.9 per cent,while Lloyds Banking Group added 1.8 per cent.

The sector had initially come under pressure after Moody8217;s Investors Service downgraded credit ratings on Credit Agricole and Societe Generale by one notch,as expected,citing their exposure to the Greek economy.

Bank of France Governor Christian Noyer called the downgrade very small,noting the ratings agency said the banks had enough capital to cover any losses.

Everyone is very very short term with their positions 8230; the trust isn8217;t there,Martin Dobson,head of trading at West house Securities,said.

We8217;ve not really got anything that people can use as building blocks for the market. It just feels that foundations are weak.

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The leaders of Germany,France and Greece will hold a conference call on Wednesday,two German government sources said on Tuesday,confirming an earlier report from a Greek official,but traders merely anticipated further rhetoric.

It would be a surprise to see some new measures announced in what8217;s basically just a conference call,Joshua Raymond,market strategist at City Index,said.

Bargain-hunting was behind much of the buying seen in the market,with beaten-down energy stocks in demand on Wednesday despite a weaker crude price.

Next grabbed the top spot on the FTSE 100 leader board,up 6.1 per cent,as Britain8217;s No. 2 fashion retailer raised its full-year profit guidance after posting an 8.5 per cent rise in first-half profit.

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Sentiment in the sector was aided by the news,with blue-chips Marks amp; Spencer and Kingfisher up 2.7 per cent and 2.5 per cent respectively,while mid caps Sports Direct ,Debenhams and Home Retail Group gained 3.1 to 4.9 per cent.

The UK benchmark index was up 10.61 points,or 0.2 per cent,at 5,184.86 by 0839 GMT,having gained 0.9 per cent on Tuesday.

The index pared gains a bit after UK jobless numbers.

While the number of Britons claiming unemployment benefit rose slightly less than expected last month,the number of people without work on the wider ILO measure showed its biggest rise in two years,official data showed.