LONDON: Britain's top shares index closed little changed on Monday as profit takers sold airlines and technical traders cashed in on signs of fading conviction among buyers.
The FTSE 100 was down 3.8 points, or 0.1 percent at 6,579.59 points, with technical sellers dragging down the index after it failed to break 6,600, a level that has capped its value since last week.
A new failure to break this resistance was seen as a sign of waning appetite for FTSE shares after the index rallied 12 percent since the start of the year, outpacing a 7 percent increase in the euro zone Euro STOXX 50 index.
"Markets are generally paused," said Lorne Baring, managing director of B Capital, which manages $500 million worth of assets and has a small "overweight" position in the FTSE.
"The UK has already been an outperformer this year and it is only natural that it can pause in August."
UK blue chips are down around 0.7 percent since the start of August, lagging a 2 percent rise for the Euro STOXX 50, as investors fretted about a possible reduction of British and US monetary stimulus in coming months.
With little in the way of corporate news, traders focused on some of the year's best performers to take some profit.
Airline EasyJet and IAG, which had risen nearly 80 percent since the start of the year, were the top FTSE fallers on Monday.
EasyJet traded at 14 times its expected earnings for the next 12 months, the highest multiple since 2009.
"It's probably at the higher end in terms of valuation (range)," said Sam Dobson, an analyst at Macquarie Research, recommending German-listed Lufthansa instead.
Insurer Prudential, up 3.6 percent, helped the FTSE limit its losses, adding 4.3 index points and leading a rally in financial stocks after raising its interim dividend on a 22 percent rise in first-half operating profits.
Trading volume was thin on Monday at around 45 percent of the index's full-session 90-day average, meaning the size of any move could be magnified by a lack of liquidity in the market.
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