FTSE rises as Lonmin leads miners, financials fall

* FTSE 100 rises 0.4 pct * Lonmin jumps after rival Xstrata launches bid * Old Mutual falls after U.S. disappointment By Dominic Lau

LONDON, Aug 6 (Reuters) - Britain's top share index edged up early on Wednesday led by miners, after Xstrata (XTA.L: Quote, Profile, Research) launched a bid for rival Lonmin (LMI.L: Quote, Profile, Research), and energy stocks, which tracked firmer crude prices, but financials fell.

By 0756 GMT, the FTSE 100 .FTSE was up 22.7 points, or 0.4 percent, at 5,477.2, after rallying 2.5 percent on Tuesday. The UK benchmark, however, is still down 15 percent for the year.

Lonmin (LMI.L: Quote, Profile, Research) jumped 50 percent after Xstrata (XTA.L: Quote, Profile, Research) launched a $10 billion takeover bid for the world's third- biggest platinum producer to further diversify and grow its business. [ID:nL6171695]

Xstrata (XTA.L: Quote, Profile, Research) edged up 0.6 percent, while BHP Billiton (BLT.L: Quote, Profile, Research), Rio Tinto (RIO.L: Quote, Profile, Research), Anglo American (AAL.L: Quote, Profile, Research), Antofagasta (ANTO.L: Quote, Profile, Research), Vedanta Resources (VED.L: Quote, Profile, Research), Kazakhmys (KAZ.L: Quote, Profile, Research) and Ferrexpo (FXPO.L: Quote, Profile, Research) rose 2.1 to 4.6 percent.

Eurasian Natural Resources (ENRC.L: Quote, Profile, Research) added 3.1 percent after the Kazakh miner said its second-quarter production volumes rose compared with the same time last year.

Johnson Matthey (JMAT.L: Quote, Profile, Research), British platinum distributor and processor, climbed 4.1 percent.

"Valuations look extremely attractive, hence the M&A that we are seeing," said Jeremy Batstone-Carr, head of private client research at Charles Stanley.

"And yet we know that earnings are under pressure as we move into slower economic growth or even recession ... That's going to be quite a significant headwind for share price," he said, adding that he hoped headline inflationary pressures would ebb in the next few months, allowing central bank policymakers to focus on shoring up growth.  Continued...