The FTSE 100 Index struggled for direction today despite a boost for Barclays and a positive start on Wall Street.
Barclays rose as much as 10% at one point as it confirmed takeover interest in its Barclays Global Investors division, which is thought to be worth around $10bn (€7.4bn).
The news helped its rivals recover ground lost this week, but the Footsie closed down 14.5 points at 4348.1 as choppy trade on Wall Street failed to guide investors.
With little in the way of corporate news to digest, the market pared its losses slightly in the wake of US news suggesting the economy’s decline may be slowing.
Excluding declining energy and food prices, core US consumer prices edged up 0.3% – slightly higher than forecast – despite news of a deeper-than-expected recession in the eurozone dampening sentiment.
In London the focus was on Barclays after talks over a sale of its BGI fund management arm emerged, with bidders reported to include US money manager BlackRock.
This gave a welcome boost to the sector after a sharp correction seen earlier in the week.
Barclays ended up nearly 6% – a rise of 14.75p to 267.75p – and Lloyds Banking Group cheered 1.4p to 89.2p.
But Royal Bank of Scotland lost its gains to end the day flat at 39.5p and HSBC slipped more than 1% – down 7.75p at 532p.
Some mining giants were also marching higher after a bout of recent profit taking, although the sector put in a mixed performance. Vedanta Resources rose 64p to 1316p, while Fresnillo and Lonmin was down 12.5p at 618.5p.
BT led the fallers’ board after a downgrade from Investec in the wake of the firm’s announcement of 15,000 job cuts and a dividend cut yesterday. Shares were down 3.4p to 85p.
The market was also held back by falls for property firms, led by Land Securities, which declined 16.5p to 473.5p after reporting a £4.8bn (€5.4bn) loss earlier this week.
Sector counterpart Hammerson fell 7.25p at 278.75p and British Land followed, off 5.25p at 391.75p.
Heavyweight stock Vodafone was also in the red, down 2.9p at 123.2p, ahead of results next week from the mobile phone giant, while insurers joined it on the fallers board, continuing to pull back from gains in their recent rally.
Standard Life was worst affected, off 6.9p at 182.7p.
Outside the top flight, Ladbrokes shares were down 9% – off 20p to 204.75p - after it said gross profits fell 34% in the first four months of the year.
The bookmaker blamed race cancellations and poor results at the Cheltenham Festival, but reported more encouraging signs in recent weeks.
The biggest Footsie risers were Barclays up 14.75p to 267.75p, Vedanta Resources up 64p to 1316p, Cobham up 7.7p to 193.2p and Experian up 17.75p to 483p.
The biggest Footsie fallers were BT down 3.4p to 85p, Standard Life down 6.9p to 182.7p, British Airways off 5.4p at 154.6p and Land Securities down 16.5p to 473.5p.