The leading share index closed lower and posted its worst week for two months after fresh Greek political drama around the terms of its second bailout package fuelled selling of cyclical stocks and brought fresh technical support into sight.

After opening down, led by miners after some weak China economic data, the blue-chip FTSE 100 <.FTSE> traded in a tight 24-point range for most of the morning, before signs of fresh disagreement over the Greek deal sent the index to its lows.

By the close, the index had shed 43.08 points to trade at 5,852.39 points, while volatility, as measured by the FTSE 100 Volatility Index <.VFTSE>, was up 10.3 percent at 20.5, a near-two-week closing high.

Nicolas Suiffet, technical analyst at Trading Central, said the cash index was pulling back from resistance around 5,905, after short-term oscillators reached overbought conditions, but a support base was near, at around 5,806 points.

Thus, the downward potential should be limited from the current levels. As long as 5,806 is not penetrated, the index is likely to resume its uptrend towards its previous high at 5,916, he added.

A fracturing of Greek political support for the austerity cuts needed to secure more bailout funds, amid calls from international lenders for even more cuts, ahead of a crucial parliamentary vote on the subject, prompted some equity investors to cut positions ahead of the close.

People are worried about newsflow over the weekend. They want to sleep easy and then look at it again on Monday, Mark Ward, equity trader at Merchant Securities, said.

The FTSE got off lightly, however, compared with falls of around 1.5 percent for Germany's DAX <.GDAXI> and France's CAC-40 <.FCHI>.

The bout of risk aversion was not restricted to equities. Safe-haven German Bunds rallied and the euro fell as the risk of a chaotic Greek default once again drove investor sentiment.

Miners and metals firms were the biggest FTSE drag, taking 17.5 points off the index, weighed by news that January imports in China -- the world's biggest consumer of metals -- had slid to their lowest point since August 2009.

As well as hitting the profits at mining firms directly, any harder-than-expected economic slowdown in China would crimp growth globally and put a dent in the bottom lines of companies from across sectors.

BHP Billiton and Rio Tinto were among the heavyweight fallers contributing to the sector weakness, down 2.7 percent and 1.1 percent, respectively, in volume slightly above their 90-day daily averages, in line with the FTSE itself.

The miner taking most points off the index, however, was Anglo American , down 4 percent in volume 1-1/2 times its average after diamond firm De Beers, in which it has a 45 percent stake, posted a fall in output and gave a cautious outlook.

Anglo American's share price has held up well against peers and implies expectations for compounded earnings per share growth of 2.9 percent every year for the next 10 years, versus contraction of 2.4 percent for BHP Billiton, Thomson Reuters StarMine data to the Thursday close showed.

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For a graphic on asset performance in 2012, click here: http://link.reuters.com/muc46s

For European banks in graphics, click here: http://link.reuters.com/qux33s

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BARCLAYS BUCKS

Among the share price winners of Friday's risk-off move, and adding most points to the index, were British American Tobacco and drinks firm Diageo , the latter up 1 percent, buoyed by a Nomura price target hike.

The firms all have a global reach, defensive qualities and a solid presence in emerging markets, with the latter a key factor for Neel Kashkari, head of global equities at PIMCO.

Until we see sustainable, real economic growth ... in America, we believe equity investors should consider high quality global companies with strong balance sheets that are selling into higher growth markets, he said in a note.

The FTSE is particularly attractive for investors looking to play the emerging market theme as many of the firms derive cashflows from across a range of countries, rather than simply being reliant on a cash-strapped UK consumer.

Among the other leading contributors to the index was Barclays , up 0.4 percent in volume twice its 90-day average -- in stark contrast to the falls suffered by all of its peers -- after it posted quarterly earnings.

Having started the day on the back foot given a miss on 4Q11 earnings, the perception on Barclays' performance and outlook is more reassuring, Espirito Santo analyst Andrew Lim said in a note.

The 4Q11 results themselves were worse than expected due mainly to weaker than expected BarCap revenues, in our view. However, the two key positives to allay concerns going forward are very flexible cost management and superior capital adequacy compared to investment banking peers.

(Graphics by Vincent Flasseur; Editing by Hans-Juergen Peters)