The top share index fell in early trade on Wednesday, pulled down by weak miners and banks in the first session after the long Christmas break.

At 8:41 a.m., the FTSE 100 index was down 15.77 points, or 0.3 percent at 5,496.93, having bounced 2.3 percent in the final two sessions before the Christmas break.

The pre-Christmas rally had seen the blue chip index turn marginally positive for December. At its lowest point in the month the index was down 3.2 percent.

Overall, however, the FTSE 100 index is currently down 6.5 percent on the year, having swung from a peak of 6,105.77 to a low of 4,791.01 over 12 months.

Miners <.FTNMX1770> led the blue chip fallers as copper prices dropped, snapping four days of gains on concern demand may wane after a report said U.S. single-family home prices fell slightly more than expected in October.

A bigger-than-expected slump in Japan's November factory output after Europe's debt crisis and flooding in Thailand hit major manufacturers also hurt copper prices.

Banks <.FTNMX8350> also moved lower, led by part-state-owned lenders Lloyds Banking Group and Royal Bank of Scotland , off 2.2 percent and 2.0 percent respectively.

Euro zone debt worries persisted as investors braced for an auction by Italy of up to 11.5 billion euros (9.6 billion pounds) of short term bills and zero coupon bonds on Wednesday.

Integrated oils <.FTNMX0530> were weak as well, although crude prices held above $109 a barrel after rallying for six straight sessions.

Crude prices were supported by a threat from Iran to halt oil shipments through the Strait of Hormuz if foreign sanctions were imposed on its crude exports over its nuclear ambitions.

The world's no. 3 retailer Tesco was the biggest blue chip gainer, up 2 percent on hopes sales figures would show a pre-Christmas spending boost on the high street.

Supermarket firm WM.Morrison added 0.2 percent.

Retail shares slid despite a survey by market researcher Experian which showed the numbers of shoppers visiting the sales on Boxing Day, the key post-Christmas sales day for the UK retail sector, was similar to 2009.

Clothing retailer Next , which provides the sector's first scheduled trading update next Tuesday, fell 0.8 percent. Marks & Spencer was down 0.7 percent.

Luxury goods group Burberry was the only blue chip trading ex-dividend on the final Wednesday of 2011, clipping 0.12 points off the index.

Technical analysis of the FTSE 100 index suggested a short-term downturn.

The top at 5,631.90 to the bottom at 5,328.70 has created a retracement zone at 5,480.30 to 5,516.08. Last week's high at 5,516.66 was slightly above the upper level of this range, said James A. Hyerczyk, Analyst at Autochartist.

The inability to hold above this price level suggests a few nervous bulls are in the market. This could lead to a near-term break back to 5,422.68 to 5,400.50. A successful test of this potential support zone could lead to the start of another rally.

No important British economic data will be released on Wednesday. Across the Atlantic, the latest weekly U.S. mortgage and refinancing index will be released at 12:00 p.m., with the Dallas Fed services report due at 3:30 p.m.

(Reporting by Jon Hopkins; Editing by Sophie Walker)