* FTSE 100 up 0.7 percent
* Randgold Resources top gainer after results
By Tricia Wright
LONDON, Feb 7 (Reuters) - Strong mining stocks helped drive Britain's top share index higher on Monday, led by Randgold Resources which advanced 4.2 percent after the West African-focused gold producer announced a sharp rise in profits.
By 0914 GMT the FTSE 100 was 38.98 points, or 0.7 percent firmer at 6,036.36, having ended up 0.2 percent on Friday at 5,997.38.
Miners added the most points to the blue chip index as copper hit a record high on Monday, underpinned by a weaker dollar and a positive fundamental outlook.
Randgold Resources said its full-year profit jumped 43 percent as higher gold prices outweighed a decline in production, and that it plans to raise its dividend by 18 percent.
Upbeat broker comment helped Xstrata, 2.6 percent ahead, as Citigroup hiked its target price to 2,011 pence from 1,600, and repeated its "buy" rating, citing superior growth, ability to do further accretive M&A deals, and cost reduction potential.
Xstrata was also aided by bullish comments from Nomura, which named it, alongside Anglo American, as a top pick.
Energy stocks were also in favour, recovering after recent falls, with BP climbing 1.2 percent.
BP is in talks with India's Reliance Industries to buy a 30 to 45 percent stake in the D6 licensing block off India's east coast, the Mint newspaper said, citing a person with knowledge of the development.
CAIRN BOUNCES BACK
Oil explorer Cairn Energy added 2.1 percent, rebounding after Friday's falls on fears for the progress of the sale of a majority stake in its local unit, Cairn India, to Vedanta Resources.
India's oil secretary said on Sunday he was hopeful of finding a "positive solution".
"(We had a) positive Wall Street. I think investors generally are just about giving the (U.S.) jobs report (on Friday) the benefit of the doubt -- obviously it was complicated as far as the weather was concerned. I think that's aided sentiment here," Keith Bowman, an analyst at Hargreaves Lansdown, said.
January's U.S. employment data showed job creation was weak, made worse by the severe winter weather, but the unemployment rate fell.
Amongst other risers on Monday can maker Rexam firmed 3.3 percent. The company has appointed Barclays Capital to sell its beverage and specialties arm in a deal that could be worth 200 million pounds ($322 million), the Mail on Sunday said.
Angus Campbell, head of sales at Capital Spreads, said overall investors were treading with caution ahead of Thursday's Bank of England interest rate decision.
"Expectations for interest rate hikes are increasing, so that is certainly something that is at the forefront of investors' minds."
"I think we're seeing this morning with copper hitting a new high that there is concern over inflation, and at some point, if it's not this week it will be very soon, that the Bank will raise rates," he said.
The market was also keeping a close eye on developments in Egypt. President Hosni Mubarak's government was to hold its first full meeting of a new cabinet on Monday since protests erupted against his rule and there was no sign yet of progress in talks with an opposition which wants him out. (Editing by Greg Mahlich)