OREANDA-NEWS. February 03, 2015. Britain's top share index edged higher on Monday, with a surge in Irish building supplies groups CRH partially counteracted by a drop in airlines after Ryanair cautioned on its profit outlook.

Shares in CRH rose 4.7 percent, the top gainer in the blue-chip FTSE 100 index, after the company said it had agreed to pay 6.5 billion euros (\\$7.4 billion) for assets that Lafarge and Holcim needed to sell to secure regulatory approval for their planned merger.

CRH, the leading producer of asphalt for road building in the United States, said the deal would expand its global reach and also make it the largest building supplier in central and eastern Europe.

"CRH has a history of acquisition and successfully integrating businesses into its operations. This deal will be large, adding 26 percent to our expected sales figure for 2014," Cantor Fitzgerald analyst Ian Osburn said.

The benchmark FTSE 100 index was up 29.00 points, or 0.4 percent at 6,778.40 points by 1126 GMT after closing 0.9 percent lower on Friday.

On the downside, budget airlines came under pressure after Ryanair, Europe's largest airline by passenger numbers, cautioned that profit growth will be modest next year as low oil prices help rivals to step up competition.

Ryanair fell 4.7 percent despite again raising its profit forecast, with the company saying it would benefit only slightly from lower jet fuel costs this year as it has hedged 90 percent of its fuel needs at \\$92 per barrel up to March 2016.

While Ryanair is not a FTSE 100 member, other airlines easyJet and IAG fell 4.8 percent and 2.5 percent respectively -- the top fallers on the index.

"Ryanair has always had particular difficulty hedging its oil. It's very difficult to hedge when you're not sure where the bottom is, but I think other airlines are in the same boat," Brenda Kelly, chief market strategist at IG, said.

Volatility in oil prices impacted energy stocks again on Monday, with the British sector up 2.8 percent, following an 8 percent jump in oil prices on Friday on a record weekly drop in U.S. oil drilling. They reversed an early fall to gain again on Monday.

"Crude oil prices are still much higher than their levels at the time of stock market closing in London on Friday and that's providing some support to energy stocks," said John Smith, senior fund manager at Brown Shipley.

"However, the problems in the oil sector will stay for quite some time and we don't see a stabilisation in oil prices anytime soon. The rally that we are seeing in oil stocks today is an opportunity to reduce some exposure to the sector."