London Market

UK STOCKS are expected to be mixed, with a decline in earnings from BP Amoco pulling oil shares down, while drugmaker Glaxo Wellcome is likely to gain on an increase in profits.

BP Amoco, the world's third largest publicly traded oil company, will release fourth-quarter profit on Wednesday. The results are the first since British Petroleum merged with Amoco in December. "BP will probably tend to be towards the lower end of the range," said Stephen Thornber, a fund manager at Threadneedle Investment Management. "With the addition of Amoco, analysts are starting at zero." The quarterly figure is forecast to be 40 to 50 per cent down.

The FT-SE 100 index rose 62.2 points, or 1.06 per cent, to 5,950.7 on Friday. British Telecommunications and Lloyds TSB led gains after both companies reported earnings at the top end of expectations.

Glaxo Wellcome is due to release earnings on Thursday. A survey of seven analysts produced an average forecast of a 12.8 per cent increase in second- half earnings, to 25.5p a share, from 22.6p in the second half of 1997. Full-year pre-tax profit is expected to fall 6 per cent, to pounds 2.52m, from pounds 2.68m a year ago.

"I expect good results from Glaxo," said Heiko Breiholz, a fund manager at Hanseatische Investment Gesellschaft, in Hamburg. "They will release many new products, and that will more than compensate for losses from the licences they've lost."

Shares of Barclays and other banks are likely to be active as Barclays releases full-year earnings on Tuesday. Barclays is expected to post second- half 1998 earnings per share of 27.4p, up 80 per cent from 15.2p in the second half of 1997, according to a survey of 19 analysts by IBES International.

The profit rise is expected mainly because Barclays took a pounds 425m charge in the second half of 1997 when it sold its equity and corporate advisory businesses. The second half of 1998 also saw difficulties, however, as the bank set aside pounds 250m to cover losses on Russian lending.

The Halifax, Britain's biggest mortgage bank, is scheduled to release earnings on Thursday and Abbey National, the second- biggest, does so on Friday.

"Banks can be a good cyclical play; their profits are geared to an upswing in the economy," said Richard Crehan, head of UK strategy at Morgan Stanley Dean Witter.

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