London midday: Gains pared despite strong performance by banks

- Government may cut stake in RBS - Defensives sold off- Resolution could split before saleThe Footsie was nearly back where it started by midday, after gains were trimmed as heavy losses for Resolution, Compass and utilities stocks weighed on the blue chip index.The earlier rise for London's blue chip index was fuelled by comments last night from Federal Reserve Chairman Ben Bernanke. He said that improvements in the US jobless rate will require "a more-rapid expansion of production and demand from consumers and businesses, a process that can be supported by continued accommodative policies." In other news, the President of the European Central Bank (ECB), Mario Draghi, has stepped up to the plate to defend the non-standard measures adopted by the monetary authority and to dismiss inflation worries. However, while he highlighted improvements in financial markets and overall economic activity, he admitted that it was "still at low levels".RBS LEADS BANKS HIGHERThe banks were among the high risers of the day, with Royal Bank of Scotland topping the list, gaining over 4%. Reports out this morning suggest that the UK government is looking to sell some of its stake in the lender to Abu Dhabi's sovereign-wealth funds. The BBC has said that it could offload up to a third of its 82% stake, following a government bailout back in 2008. Sector peers Lloyds, Standard Chartered and Barclays were also on the rise.Cooper miner Kazakhmys was a strong performer after publishing its full-year results. Despite the majority of the main figures being revealed in a pre-close trading update earlier this month, shares rose 3%. Revenues rose to $3,563m from $3,237m in 2010, while EBITDA edged up to $1,959m from $1,932m the year before. Fellow miner Rio Tinto also rose after saying that it is thinking about offloading its diamond interests and has begun a strategic review of the business.With investors shifting their positions into banking and mining stocks, the relatively 'safer', defensive sectors such as the utilities were sold off. International Power was the worst performing utility despite announced that its 815MW coal-fired power plant in Indonesia has started commercial operation. Sector peers National Grid, Severn Trent and United Utilities were also lower. Oil and gas stocks were also out of favour, with BP, BG Group and Petrofac registering slight losses by midday.Leading the downside was insurance group Resolution after revealing that it could split its business into two to attract a buyer. Meanwhile, profit before tax in 2011 came in at £681m, ahead of a consensus prediction from forecasts compiled by I/B/E/S of £602m. Shares dropped as much as 7% early on, but were trading down over 3% by lunchtime.Contract caterer Compass fell after admitting that like-for-like (LFL) sales growth in the first half of its financial year is likely to be slower than that seen in the corresponding period a year earlier.Plumbers' merchant Wolseley also declined after saying that the LFL sales growth seen in the first half (5%) had tapered off during the start of the second half. FTSE 250: PZ CUSSONS ISSUES PROFIT WARNINGPZ Cussons, the Imperial Leather soap maker, has warned the impact of economic and social tensions in its largest market of Nigeria would be significant, resulting in overall performance being some way below expectations. Shares were down nearly 9%.Heading the other way was engineering support services group Babcock after saying that the overall trading performance for the 2011/12 fiscal year was in line with expectations. Peel Hunt said this morning that the stock could potentially enter the FTSE 100 index.BCFTSE 100 - RisersRoyal Bank of Scotland Group (RBS) 28.94p +4.29%Kazakhmys (KAZ) 957.50p +3.51%ITV (ITV) 90.80p +2.37%Barclays (BARC) 253.50p +2.36%Schroders (Non-Voting) (SDRC) 1,280.00p +2.07%Standard Chartered (STAN) 1,628.00p +2.01%Man Group (EMG) 136.00p +1.87%Vedanta Resources (VED) 1,331.00p +1.84%Rio Tinto (RIO) 3,421.50p +1.69%Schroders (SDR) 1,652.00p +1.66%FTSE 100 - FallersResolution Ltd. (RSL) 266.00p -3.24%Compass Group (CPG) 651.00p -2.54%International Power (IPR) 377.00p -1.41%BP (BP.) 475.40p -1.35%National Grid (NG.) 633.00p -1.33%United Utilities Group (UU.) 607.50p -1.14%Severn Trent (SVT) 1,552.00p -0.96%Randgold Resources Ltd. (RRS) 5,730.00p -0.87%Smith & Nephew (SN.) 632.50p -0.86%Petrofac Ltd. (PFC) 1,705.00p -0.81%FTSE 250 - RisersBabcock International Group (BAB) 803.00p +3.61%Afren (AFR) 135.30p +3.28%TR Property Inv Trust Sigma Shares (TRYS) 71.75p +3.24%Hikma Pharmaceuticals (HIK) 695.00p +2.96%Ocado Group (OCDO) 120.40p +2.73%Dixons Retail (DXNS) 19.93p +2.73%QinetiQ Group (QQ.) 149.80p +2.60%Moneysupermarket.com Group (MONY) 132.20p +2.56%Spirent Communications (SPT) 157.00p +2.41%Laird (LRD) 215.40p +2.33%FTSE 250 - FallersPZ Cussons (PZC) 305.00p -8.71%Exillon Energy (EXI) 166.70p -2.80%Home Retail Group (HOME) 119.00p -2.14%Cable & Wireless Worldwide (CW.) 35.99p -2.07%Cable & Wireless Communications (CWC) 32.29p -2.06%Paragon Group Of Companies (PAG) 186.40p -1.89%Big Yellow Group (BYG) 294.90p -1.86%Dunelm Group (DNLM) 509.50p -1.83%Anglo Pacific Group (APF) 329.10p -1.82%Premier Farnell (PFL) 218.70p -1.75%