By Danilo Masoni
MILAN (Reuters) - The UK's top share index was on track for its fourth straight day of gains on Wednesday, helped by continued strength in energy stocks thanks to strong crude prices, while a lowered outlook hit bookmaker Paddy Power Betfair.
The FTSE 100 rose 0.3 percent to 7,741 points by 0859 GMT, while the mid cap FTSE 250 <.FTMC> index was 0.2 percent higher.
Shares in Paddy Power Betfair <PPB.L> were the biggest fallers on the FTSE, down 2.6 percent to their lowest level in nearly three months. Earnings and revenue grew at a much faster rate in the second quarter but the bookmaker cut its full-year outlook due to the introduction of additional taxes and losses from its growing U.S. business.
Drugmakers were also a drag, as the sector in Europe was burdened by a series of disappointing earnings updates. AstraZeneca <AZN.L> and GlaxoSmithKline <GSK.L> were the biggest weights on the FTSE, both down around 0.5 percent before recovering to trade around 0.3 percent lower on the day.
Gains in the energy sector, however, more than offset weakness among drugmakers.
The FTSE 350 Oil & Gas index, which tracks shares in BP <BP.L> and Shell <RDSa.AS>, has gained 3.1 percent in the last four days on the back of the recent rally in crude oil prices.
Oil prices softened on Wednesday after China reported relatively weak import data, although the market remained well supported by falling U.S. crude inventories and the introduction of sanctions against Iran.
"With Iranian oil exports down 7% in July, for a third consecutive month of declines, and after the US decision to impose further sanctions on Iran's oil industry, this would (provide) yet further evidence of a tight global oil market which could move both barrel prices and FTSE Energy names," Accendo Markets' Mike van Dulken and Artjom Hatsaturjants said in a note.
Among mid-caps, Hill & Smith <HILS.L> was a big faller, down 20 percent, after the infrastructure products maker posted a double-digit drop in half-year core earnings due to delays in the UK's roads programme and utilities market.
Bellway <BWY.L> fell 4 percent after the builder said it expected home price growth to slow in the year ahead, hitting margins that have buoyed results over recent years.
The grim outlook weighed on other builders, with shares in British Land <BLND.L>, Persimmon <PSN.L> and Barratt <BDEV.L> all down around 0.8 percent. The sector has been hit this year by worries over rising costs and cooling house prices, although some brokers are upbeat about their prospects, given attractive valuations.
Liberum analysts affirmed their buy rating on Bellway, saying: "Trading remains robust, but management is acknowledging that selling price inflation has moderated, unsurprisingly. The shares look cheap."
Elsewhere, miner Glencore <GLEN.L> fell 0.8 percent after its results slightly lagged analyst expectations. It posted a 23 percent rise in first-half earnings and a 12 percent increase from its trading division, while noting higher production costs for copper and zinc and a still volatile market.
Investec, which kept the stock at buy, said results were "on the soft side" of consensus expectations, also noting that despite net debt falling below targeted levels, the company did not announce any additional shareholder returns.
(Reporting by Danilo Masoni; Editing by Mark Trevelyan)
