Top shares were steady by midday on Monday, as weakness in financials offset gains in miners, which were boosted by manufacturing data from China that painted a brighter picture of the world's fastest growing economy.
London's blue chip index was down 0.43 of a point at 5,768.02 by 01:12 p.m.
The main drag on the FTSE 100 was the banking sector <.FTNMX8350>, which remains up around 17 percent in 2012 and has avoided the sell off experienced by the miners over the past month.
Lloyds Banking Group
Markets have stabilised of late and there are no obvious catalysts that we can see to potentially push markets on, through the top of the current range, Oliver Wallin, Investment Director at Octopus.
When we have opted to increase our weightings in risk assets, we've done so with a degree of wariness, taking profits along the way but also keeping a cautious eye open for any signs of deterioration in the economic outlook, he said, adding Octopus' portfolios are taking on a more defensive slant.
Miners <.FTNMX1770> bounced off recent lows helped by slightly better manufacturing data from the world's most voracious consumer of raw materials, China.
The sector, which recently touched oversold levels according to their 14-day relative strength index, gained in tandem with copper prices as the data from China soothed concerns of a hard landing for the country's economy.
Rio was upgraded to overweight from equalweight by Barclays in a review of UK-listed miners.
The early upgrade for Rio … remains somewhat tentative given a lack of clarity on the outlook for the Chinese steel industry, but the stock trades on the lowest multiples in the market and we feel may well be the first to refresh a capital return, Barclays says.
Barclays, however, cut its rating on Anglo American
Nomura, which cut its recommendation on the gold miner to neutral from buy late on Friday, says potential sanctions on Mali could impact full-year 2012 substantially.
With China data the main theme engineers such as Weir
Citigroup said IMI
Elsewhere, PMI data was mixed, highlighting the battle companies face to meet analysts' earnings forecasts as the euro zone's manufacturing sector contracted for an eighth straight month.
Across the Atlantic, equities were set to open flat ahead of March's U.S. ISM survey and February construction spending data, which will both be released at 03:00 p.m. on Monday.
(Written by David Brett; Editing by Toby Chopra)