Footsie loses early gains

Investors stuck to the sidelines today ahead of a wave of crucial interest rate decisions.

By lunchtime the FTSE 100 Index was down just 2 points at 4144.1, after losing all its early gains.

The Footsie was boosted early on by the result of the mid-term US elections - the victorious Republican party is expected to be more business-friendly and analysts are forecasting strong gains on US markets later today.

But the rise was short lived and shares in London fell back as traders looked ahead to three key rate decisions due to be announced over the next 24 hours.

The Federal Reserve is expected to cut rates in the US by a quarter point tonight.

The Bank of England and European Central Bank announce the results of their own meetings tomorrow, but analysts are split over whether they will cut.

In London, a number of heavyweight stocks were weighing on the market.

Banks slipped with Barclays down 4.5p at 473.5p, HBOS off 9.5p at 754p and Lloyds TSB 1.5p lower at 589.5p.

Energy firms were also subdued after data showed a rise in oil supplies - putting pressure on the oil price. BP slipped 9.5p to 397p while Shell fell 3.75p to 415p.

But pharmaceuticals stocks were helping offset the falls. Shire Pharmaceuticals added 3p to 515p as it reported third-quarter figures in line with forecasts.

GlaxoSmithKline was strongly ahead, up 46p at £12.74, while AstraZeneca rose 43p to £23.04.

Outside the Footsie, transport specialist FirstGroup steamed ahead 8% after a strong set of interim results, with turnover above £1 billion.

The group, which added that passenger volumes on First Great Western and First Great Eastern were up 4%, rose 16.25p to 226.25p.

Distributor Electrocomponents surged 17%, up 44p at 296p, after it predicted markets would not deteriorate further.

Although the former blue-chip warned it saw no signs of recovery in the short term, it did not believe conditions would worsen.

Steel processing group Precoat also soared, rising 32%, or 20.5p to 85.5p, after Anglo-Dutch steel firm Corus tabled an 88p-a-share takeover offer.

The deal values Precoat at £7.5 million. Corus was up 3.25p at 46.75p.

But mobile retailer Carphone Warehouse slid 11%, off 10.25p to 86.75p despite reporting half-year figures in line with forecasts and making upbeat comments about Christmas. Shares fell following a broker downgrade on the shares on concerns about margins.