The FTSE 100 edged down on Friday, with investors disappointed by the lack of a deal on Greek debt and heavyweight BP
By 12:30 p.m., the FTSE-100 <.FTSE> was down 0.4 percent, or 21.70 points, at 5,773.50. BP's 1.9 percent fall shaved 7 points off the index after the oil giant lost its attempt to shift over $15 billion of costs related to the Gulf of Mexico oil spill onto contractor Transocean
Investors were reluctant to take on fresh bets on the index -- which is still up 0.7 percent for the week and 3.6 percent since the start of the year -- until Greece reaches a deal with its creditors.
Without a deal, Greece could be heading for a disorderly default, with potentially glum consequences for the euro zone -- and thus for Britain, for whom the bloc is the biggest trading partner.
Euro zone finance officials voiced optimism on Friday that a deal was imminent but markets -- which had hoped for an agreement earlier in the week -- remained a little sceptical.
Because (a solution) hasn't materialised it seems to be weighing down the market. The stocks that have gained have started to come off, the mining sector and the banking sector have led the way down this morning, said Martin Dobson, head of trading at Westhouse Securities.
Miners lost 0.7 percent <.FTNMX1770> after a 4 percent surge the previous session, which was fuelled by solid production reports and hopes of stronger demand from the United States.
Further clues on the health of the world's largest economy -- and thus likely demand for metals and other natural resources -- will come with the release of U.S. growth figures, out at 1:30 p.m.
Economists estimate GDP grew at a 3.0 percent annual pace in the October-December period, according to the median forecast in a Reuters poll. That would be a step-up from the third quarter's 1.8 percent rate and it would be the quickest pace since the second quarter of 2010.
Defensive tobacco and pharmaceutical stocks, which tend to enjoy strong demand regardless of the macroeconomic backdrop, performed relatively well, led by Imperial Tobacco
Comments from Citigroup helped support the cigarette maker, which rose 1.7 percent, with the bank lifting its target price on the stock to 2,570 pence from 2,550, as it repeated its buy rating, saying recent share price weakness has been overdone.
Technical analysts at SEB said the FTSE -- which closed at 5,795.20 on Thursday after briefly rising above 5,800 for the first time in six months in intraday trading -- was now in a sideways trading phase.
There are however yet no signs of weakness visible so a neutral view is still advocated, they added. Brave ones could try a small short position with a stop above 5,900.
(Additional reporting by Tricia Wright; Editing by Jodie Ginsberg)