London: Britain’s top share index was flat in early trade on Friday, with weakness in banking issues and energy stocks balanced by a recovery from miners and strength in heavyweight Vodafone.
By 0925 GMT, the FTSE 100 index was up 1.52 points at 5,336.62, having fallen 1.7% in the previous session, taking its weekly decline so far to 2.3%, which would be the biggest weekly fall in 6 weeks.
Banks were the biggest sector falls in early deals, echoing the performance of their US peers overnight after US President Barack Obama said banks should no longer be allowed to own, sponsor or invest in hedge funds for proprietary profit.
Barclays, Royal Bank of Scotland, and HSBC fell 0.5 to 3.8%.
Worries have already built up over the state of the industry following a glut of disappointing earnings news from US banks in the past week.
ICAP, the world’s largest inter-dealer broker was the top FTSE 100 faller, down 6.1% on worries the move will curb its business.
Oils were weaker with crude stagnating around $76 a barrel and the uncertainty over the demand outlook.
Royal Dutch Shell, BP each fell 0.4%, but BG Group rose 1.6 and 0.8% respectively.
Profit-takers moved in on the pharmaceutical stocks, which were among a select group of stocks in positive territory in the previous session on hopes Obama’s healthcare plan will stall and as investor risk appetite waned. AstraZeneca, boosted on Thursday by a Morgan Stanley upgrade, shed 0.4%.
Miners were mainly higher in choppy trade, bouncing back from heavy losses sustained on Thursday following news that Australian miners will face billions of dollars in new taxes.
Rio Tinto, Xstrata, BHP Billiton, Anglo American and Eurasian Natural Resources were the biggest risers, up 0.1 to 0.6%.
The sector has been under pressure amid fears that China could tighten fiscal policy.
“There has been an element of bottom picking this morning given the clearout over the last few days,” said Manoj Ladwa, senior trader at ETX Capital.
Mobile telecommunications firm Vodafone contributed the single most points to the index, up 0.8% recovering losses sustained on Thursday.
Selected defensive issue were higher, with Imperial Tobacco and British American Tobacco up 0.4 and 0.1% respectively.
Retailers were also in demand. Kingfisher rose 1.9% after Morgan Stanley upgraded the stock to “overweight” from “equal-weight”, and Marks & Spencer added 0.6%.
No important US economic data are due on Friday, but another batch of fourth-quarter earnings will be key for investors, with General Electric and McDonalds the main features.