Jan. 28 (Bloomberg) -- U.K. stocks climbed for the second day, following three sessions of declines. British Airways Plc, Europe's biggest airline, paced the gains.

The FTSE 100 Index gained 17.8 points, or 0.4 percent, to 4464.80 as of 12:03 p.m. in London. The benchmark fell as much as 0.5 percent in earlier trading. The FTSE All-Share Index added 6.89 points to 2218.92.

British Airways shares gained 12.5 pence, or 4.3 percent, to a 26-month high of 303.75 pence. Chief Executive Rod Eddington said he plans to cut an extra 300 million pounds ($550 million) of employee costs through 2006 to boost profit.

``They are in a position of recovery,'' said Justin Urquart Stewart, who helps manage about $459 million at 7 Investment Management in London and holds British Airways shares. ``Business traffic has been picking up and BA has benefited.''

First- and business-class traffic gained 4.7 percent last month from December 2002 in the third straight monthly increase, the airline said on Jan. 6. Demand for long-haul flights has benefited from an improving U.S. economy.

Rising sales and optimism about economic growth boosted other stocks. Savills Plc, which manages luxury properties in cities from London to Hong Kong, climbed 8.7 percent to 362.5 pence, at least a six-year high.

The company said 2003 earnings exceeded analysts' forecasts after revenue climbed at its residential and commercial businesses. Pretax profit was about 35 million pounds, Savills said, without providing comparative figures.

Last Updated: January 28, 2004 07:21 EST