Britain's FTSE 100 index closed a shade lower on Tuesday as positive corporate results and a bounce in oil and gas producers was offset by sluggish economic data from the United States.
Heavyweight mobile phone company Vodafone had boosted the market early in session, tacking on as much as 4 percent to a 12-month high after the company said half-year earnings topped forecasts.
But it gave up those gains through the session and closed down 0.3 percent as traders took profits on the rise, citing a strong recent run higher in the stock. The latest US economic data weighed on the market and Wall Street stocks slipped after the opening bell there.
"Mixed data out of the US has shown again that inflationary pressures are clearly ebbing across the Atlantic," said Paul Webb, trader at CMC Markets. The FTSE 100 closed down 7.6 points, or 0.1 percent, at 6,186.6. US economic reports showed producer prices tumbled in October at their sharpest rate since a matching record drop 5 years ago, influenced by cheaper energy costs that also sapped retail sales and showed a softening pace of economic activity.
But FTSE traders will scour the Bank of England's quarterly inflation report and the latest UK jobs report on Wednesday for more indicators on future interest rate decisions after the quarter-point UK rate rise to 5 percent last week.
As oil climbed back above $59 a barrel, recovering from a two-day slide, oil and gas producers benefited. BP climbed 0.5 percent and Royal Dutch Shell was up 0.3 percent.
Among companies reporting earnings on Tuesday, Intercontinental Hotels, the world's largest hotel group, gained 1.6 percent after its third quarter operating profit was in line with expectations.
Energy supplier Scottish Power slipped 0.6 percent after it smashed forecasts with a 77 percent jump in first half profit. The boom in its bottom line prompted fears among traders that the strength in the numbers could deter the bid approach from Spain's Iberdrola. "The corporate news today has been very good," said Iain Armstrong, equity analyst at Brewin Dolphin Securities.
The market will now turn its attentions to results from Sainsbury, Vedanta and National Grid due later in the week, he added. Credit information firm Experian, a recent spin-off from conglomerate GUS, led the gainers, up 2.5 percent to its highest level since March as traders cited a deal over disputed debts with GUS.
As base metals firmed, miners reversed some of the sharp losses from Monday. Kazakhmys climbed 1.7 percent and Vedanta added 1.8 percent.
Anglo American was up 0.5 percent on further bid talk, a trader said. South Africa's Oppenheimer family said on Friday it had sold a third of its holding in Anglo to Chinese billionaire Larry Yung. Analysts said the sale may revive bid talk for Anglo, the world's third-largest miner, as Yung heads acquisitive Chinese conglomerate CITIC Pacific Co Ltd.
On the downside, BSkyB was among the blue chip decliners, down 2.3 percent after a Deutsche Bank report quoted the company's major shareholder Rupert Murdoch as giving a cautious outlook on operating profit, traders said.
Morrison fell 1.7 percent after profit-taking, with traders suggesting recent gains had come too quickly for the supermarket firm. Among midcaps, support services firm Babcock International tacked on 9.9 percent and hit fresh life highs after it posted a 40 percent rise in half-year profit before tax and forecast a better-than-expected full year.
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