At 8:30am, the FTSE100 was down 4.48 points at 5,518.02 with the FTSE250 off 9.68 points at 9,547.41 and the FTSE Smallcaps 1.36 points lower at 2,815.03.

US & ASIA

In the US last night, the Dow closed down 12 points at 10,572, the Nasdaq Composite was flat at 2,309 and the S&P500 gained 4 points at 1,137.

In Asia today, the Nikkei was up 49.62 points at 10,731.45, while the Hang Seng was recently ahead 137.09 points at 22,416.67.

Crude oil traded at $81.78 a barrel on Nymex.

LONDON MARKETS

UK Services PMI is due for release at 9:30am.

Retailers hogged the limelight in London again today, although it was the banking sector that kept FTSE100 losses to a minimum in early deals.

Royal Bank of Scotland was the biggest blue chip gainer of the morning, up 1.13p at 36.53p, while Lloyds Banking Group added 0.68p at 54.71p and Barclays advanced 3.7p at 301.8p.

Selected miners also provided support for the main index, with Vedanta Resources the leading light, up 23p at 2,777p. ENRC rose 8p at 978p, Anglo American lifted 13.5p at 2,828.5p and Rio Tinto was 15p better at 3,557.5p.

Randgold Resources ticked up 5p at 5,180p as gold settled around the $1,124 an ounce mark.

Commercial property firms were in demand, following press comment that office rents in London as expected to soar as banks decide to remain in the city.

Hammerson added 5.2p at 414.2p, helped by an upgrade to neutral from sell at UBS with the target price raised to 425p from 370p. Land Securities gained 4.5p at 671p and British Land move 2p higher at 472p.

On the downside with blue chips, Marks & Spencer tumbled to the foot of the blue chip ladder, off 18.3p at 386.6p, as news of the first increase in sales for some considerable time was offset by a cautious outlook for the sector and a downgrade to hold from buy at Seymour Pierce.

Among the major retailers, only Tesco and Morrisons made any progress, up a modest 0.55p at 421p and 0.8p at 278.7p. Rival Sainsbury stumbled 2p at 317.9p.

Fashion house Next fell a further 6p at 2,094p and DIY was out of favour pushing Home Retail Group down 3.5p at 286.4p and Kingfisher 1.8p lower at 231.6p.

Holiday operators were knocked by the bad weather and fears over disruption to travel, with Thomas Cook falling 0.7p at 237.2p and TUI Travel edging down 0.9p at 258.8p.

Cadbury suffered from the fallout from Warren Buffet's criticism of Kraft's bid antics and Hershey's reluctance to firm up on interest in the confectioner. Cadbury shares sank a further 5.5p at 773.5p.

Other notable losers in early trade included household goods conglomerates Reckitt Benckiser and Unilever, down 16p at 3,301p and 8p at 1,945p, respectively.

Story provided by Business Financial Newswire