The FTSE 100 index slipped back in early deals on Wednesday, retreating after strong gains in the previous session as investors looked to the Federal Reserve to deliver on hopes for further economic stimulus measures.
The latest two-day monetary policy-setting Federal Reserve Open Market Committee meeting concludes on Wednesday, with a decision on interest rates and any possible further capital injections for the ailing U.S. economy due after the London markets close at 1630 GMT.
"With such strong expectations that the Fed will announce a measure of stimulation, the market may find itself caught ‘Long and Wrong' should Chairman Bernanke decide not to live up to the markets wishes. The door is definitely open for the Disappointment Trade," said Andrew Taylor, market strategist at GFT Global in a note.
At 0804 British time, the FTSE 100 index <.FTSE> was down 9.81 points, or 0.2 percent, at 5,576.50. The UK blue-chip index closed up 1.7 percent on Tuesday, ending just below the 5,600 level, which it breached briefly in late afternoon trade for the first time since the start of May.
(Reporting by Jon Hopkins; editing by Simon Jessop)