Britain's biggest shares fell in thin trade on Tuesday, but closed above session lows as weakness in oil and gas stocks was countered by strength among financials and miners and gains on Wall Street.
Drinks-can maker Rexam featured among the heaviest fallers, down 1.8 percent, as investors sold the stock after it hit a seven-week high on Monday and ahead of results from the group on Thursday.
"People are selling. They don't want to hold them ahead of the figures as they've run up recently," said one trader.
BAE Systems also took back some of its recent gains, falling 2.5 percent after touching its highest level in two and a half months on Friday, when news of an order for 72 jets from Saudi Arabia boosted the defence group.
Oil stocks took the heaviest toll on the market, with BP down 0.5 percent and Royal Dutch Shell off nearly 1 percent. Crude prices steadied after surging over the past two trading days.
Investors had little to digest, however, with corporate and economic news thin on the ground and many market players still away for the summer holiday.
By the close, the FTSE 100 index was down 12.6 points at 5,902.6 in lacklustre volume of just 1.7 billion shares across the entire UK market.
"I think we're faced with a bit of a trading range for a while where the market will move about in a broad range and be happy to do that until it gets a much clearer picture from the central bank or the earnings front," said Mike Lenhoff, chief strategist at brokerage Brewin Dolphin. He added that while investors were wary of a slowdown, equities did not appear to be bracing for a sharp slump in activity.
"It doesn't strike me that the market is banking on a material slowdown or a very serious downgrading. The view I'm taking is that I don't think we're going to see a recession in the US and meanwhile, I think we're going to see reasonably decent growth elsewhere, which means the prospects for company earnings are still going to be okay."
On Wall Street, US stocks edged higher, helped by broker upgrades on technology shares.
Shares in the world's largest hotelier, InterContinental Hotels, ended down 0.7 percent despite a 30 percent rise in first-half profit. Investors were disappointed there was no new announcement on the amount and timing of a cash return to shareholders.
"The trading update was positive but there was profit-taking after a reasonable bounce, and no new announcement of cash returns," said analyst Mark Reed at Teather & Greenwood.
Among gainers, Lloyds TSB edged higher as traders cited renewed market talk that Bank of America might be looking to make a take-over bid for Britain's fifth-biggest bank. Insurers also ticked higher, with Royal & Sun Alliance and Legal & General both up over 1 percent.
In the mining sector, BHP Billiton, Antofagasta and Anglo American all rose slightly. Talk of sector consolidation and optimism over continuing demand for metals has held interest in the sector over recent months. Miners make up four out of the five top FTSE 100 gainers so far this year, with Lonmin up nearly 80 percent in the year to date and Xstrata over 60 percent higher since January. Among mid-caps, engineer Bodycote fell 4.6 percent as worries over energy costs outweighed a 20 percent jump in its first-half profit.
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