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* European stocks hit by renewed fears around COVID-19
* River and Mercantile Group rises on two takeover
approaches
* FTSE 100 up 0.3%, FTSE 250 off 0.7%
(Updates to close)
By Bansari Mayur Kamdar
Nov 23 (Reuters) - UK's FTSE 100 rebounded to end higher on
Tuesday as gains in mining and energy shares countered fears
over a resurgence in COVID-19 cases in Europe, while online
electricals retailer AO World plummeted after warning of product
shortages.
After falling as much as 0.7%, the blue-chip FTSE 100
ended 0.3% higher, aided by advances in miners including
Rio Tinto, BHP Group, Glencore and oil
majors BP and Royal Dutch Shell.
However, investor sentiment was in check as continental
Europe, where German and French stocks were
down on concerns about fresh restrictions amid a resurgence in
COVID-19 cases.
"The fourth wave of COVID being endured in parts of
Continental Europe is prompting the reintroduction of
restrictions and resulting civil unrest, threatening its
economic recovery," said Russ Mould, investment director at AJ
Bell.
British minister Robert Courts said on Monday the UK was
looking to review its COVID-19 travel rules in January.
Britain has lagged European peers in lifting travel
restrictions with airlines complaining that the need for day-2
coronavirus tests and complicated passenger locator forms have
deterred UK travel.
The FTSE 100 has advanced 11.6% so far this year, helped by
robust corporate earnings and record low interest rates.
However, it continues to underperform its European peers as
supply chain constraints and inflationary worries weigh on
businesses.
Meanwhile, euro zone business growth unexpectedly
accelerated this month but another wave of coronavirus
infections and new restrictions, alongside price pressures, are
likely to put a dent in December's expansion, a survey showed.
The domestically focussed mid-cap index declined
0.7%, with AO World plunging 15% after it cut its fiscal
2022 profit outlook due to supply chain issues and warned of
product shortages ahead of the key holiday shopping season.
Shares of Compass Group reversed early losses to end
6% higher after Chief Executive Dominic Blakemore said new
business will help the British caterer regain its pre-pandemic
size and grow faster than before.
In M&A news, fund manager River and Mercantile Group
surged 8% after saying it had received preliminary approaches
from rivals Premier Miton Group and AssetCo Plc
for a possible takeover.
(Reporting by Bansari Mayur Kamdar and Amal S in Bengaluru;
Editing by Subhranshu Sahu and Bernadette Baum)
