The FTSE 100 index ended 18.29 points lower at 5,762.06. Volume was thin as many traders extended their Easter holidays, with just 74 per cent of the average of the last 90 days transacted.
Miners were the biggest drag on blue-chip sentiment as metal prices retreated, with the demand outlook clouded by festering worries on Greece’s debt problems.
BHP Billiton, Antofagasta, Rio Tinto, Anglo American, and Kazakhmys lost between 1.2 and 2.6 per cent.
Output in Britain’s service sector fell during a snowy January at its fastest monthly pace since August, more than reversing the previous month's gain, official data showed. This dented the pound but left the equity market unaffected.
The Office for National Statistics said services output fell 0.7 per cent on the month after a 0.6 per cent rise in December. Year-on-year, output was down 1.1 per cent in January, the same as in the previous month.
“The [services] PMI data was disappointing, there are not many drivers to push the market higher and we are more likely to see bouts of consolidation the higher we go,” said Josh Raymond, analyst at City Index.
A daily YouGov/Sun poll yesterday showed the gap between the opposition Conservative Party and the ruling Labour Party narrowed to eight points. This would make the Conservatives the largest party in parliament, but without an overall majority.
Oil majors were weaker as the crude price slipped back slightly after recent strong gains, with BP, Royal Dutch Shell, BG Group, Tullow Oil, and Cairn Energy down 0.4 to 3 per cent.
With a slight dimming of risk appetite, pharmaceuticals stocks and tobacco companies, which tend to outperform in a falling market, gained ground.
GlaxoSmithKline, AstraZeneca and Imperial Tobacco added 1.1 to 2.6 per cent.
Man Group was the top FTSE 100 gainer, jumping 6.1 per cent after the hedge fund firm’s flagship AHL fund saw a 3.81 per cent rise in its weekly net asset value, and as Execution Noble started coverage on the stock with a “buy” rating.
Mobile telecoms heavyweight Vodafone was a drag on the FTSE 100, down 1.2 per cent as hopes for a resolution of the future of its US joint venture with Verizon faded.
Ex-dividend factors knocked 2.28 points off the index yesterday, with insurer Prudential, British Land and Pearson all losing their dividend attractions.
British Land also suffered after UBS cut its stance to “neutral” from “buy” in a review of the UK real estate sector.