Dec 12 (Reuters) - Britain's FTSE 100 index inched higher on Thursday, boosted by Diageo after a brokerage upgrade, while SThree weighed on the midcap index as it dropped to a more than four-year low on a profit warning.
The benchmark FTSE 100 (.FTSE), was up 0.1% and the midcap FTSE 250 (.FTMC), fell 0.1%.
Leading the blue-chip index's gains was Diageo (DGE.L), which rose 2.8% after brokerage UBS upgraded the spirit maker's rating to 'buy' from 'sell', helping the beverages (.FTNMX451010), sector lead sectoral gains with a 2.4% rise.
Precious metal miners (.FTNMX551030), led the sectoral losses, falling 2.9%, after gold prices edged down after hitting its highest since Nov. 6 earlier in the session, as investors awaited U.S. PPI data for signals on the Federal Reserve's interest rate outlook.
Severn Trent (SVT.L), advanced 1.8% after Barclays raised target price on the water supplier to 2,800p from 2,500p.
SThree (STEMS.L), tumbled 26.5% to the bottom of FTSE 250 after the recruiter warned its 2025 fiscal year profit would badly miss forecasts, citing tough market conditions amid political and macro-economic uncertainty in Europe.
In contrast, Currys (CURY.L), rose 17.3% to the top after the electricals retailer maintained its annual profit growth forecast despite warning that price hikes were inevitable after the government's tax-raising budget and also reported a return to first-half profit that exceeded expectations.
Auction Technology (ATG.L), gained 3.4% after private equity firm TA Associates agreed to sell 15.3 million shares in the online auction operator at 5.50 pounds per share.
Separately, European stocks pared losses after the European Central Bank cut interest rates by 25 basis points as expected, and left the door open for further easing to support a struggling economy amid heightened political risks.
On the other hand, the Bank of England is expected to hold rates at its meeting next week. Its governor Andrew Bailey earlier this month pointed to gradual cuts in interest rates over the next year.
Gross domestic product estimate for October, due on Friday, will be a key economic indicator before the BoE's Dec. 19 policy verdict.
Britain's housing market strengthened further in November although uncertainty over the economic outlook could curtail activity in the months ahead, according to a survey from the Royal Institution of Chartered Surveyors.
Reporting by Nikhil Sharma and Sukriti Gupta; Editing by Mrigank Dhaniwala and Shailesh Kuber
