UK stocks finished the week on a dull note as disappointing data from the States and an ongoing summit of European leaders in Brussels dampened risk appetite in afternoon trade.
Following a barrage of impressive US economic figures over recent weeks - especially from the labour market - sentiment was dampened today by the University of Michigan's consumer-confidence index which fell from 77.6 to 71.8 in March. Analysts were expecting a slight rise to 78.
The data prompted a weak start on Wall Street this afternoon as traders took profits after the S&P 500
finished two points shy of an all-time high on Thursday. The Dow Jones Industrial Average, meanwhile, looks set to snap a 10-day winning streak if it closes in the red, ending its longest rally since 1996.
Investors focus on EU meetings
This side of the Pond, leaders at the EU summit yesterday indicated that they will relax the conditions relating to deficit targets. European Commission President José Manuel Barroso expressed the idea that countries completing the requirements should be given a helping-hand.
French President François Hollande said: "if there is too much austerity, there will be too much unemployment. Flexibility is necessary if we want to make growth the priority."
As for today, EU leaders are expected to discuss a possible exit of Ireland from the bailout programme after a successful 10-year debt auction earlier this week. Meanwhile, the Eurogroup is meeting this afternoon to discuss the aid package for Cyprus.
Elsewhere in the Eurozone, Italy came no closer to solving its political uncertainty as the parliament met for the first time since last month's polls. It puts another spanner in the works for Europe's third-largest economy following the elections, which left the centre-left with a majority in the lower house but without the numbers to control the Senate and form a government.
FTSE 100: IAG flying high after Morgan Stanley upgrade
Airline group IAG was performing well after Morgan Stanley upgraded its recommendation on the stock to 'overweight', saying that the market has not fully digested the significance of the Iberia restructuring.
"We see the group reshaping toward a higher weight of BA traffic and earnings in comparison to Iberia, and expect this to be reflected in an improved earnings outlook and stock sentiment," the broker said.
Aggreko received a boost by Deutsche Bank, which upped to shares
to 'buy', whil chip designer ARM Holdings was also higher after Jefferies upgraded the stock from 'hold' to 'buy', saying that the business looks well-positioned for the mid-to-long term.
In contrast, oil titan Royal Dutch Shell was being weighed down by a ratings cut by JPMorgan Cazenove to 'underweight'. Supermarket group Morrison was weighed down by Credit Suisse which trimmed its forecasts, citing a weak LFL figure in the fourth quarter.
Meanwhile, several financial stocks, including banking group HSBC, were falling in sympathy with US peer after the US Federal Reserve said that it saw weakness in the capital plans of JP Morgan Chase & Co. and Goldman Sachs Group.
FTSE 250:Rentokil surges as profits rise; bwin.party disappoints
Pest control and hygiene giant Rentokil Initial jumped over 10% after it revealed robust 2012 results, beating analyst expectations. Adjusted pre-tax profits came to £191m, a 10.1% year-on-year rise.
Online gaming firm bwin.party slumped after reporting a 17% fall in clean EBITDA in 2012 owing to an increase in gaming taxes and lower sales. The firm also said that the revenues are expected to decline further in 2013.
Pubs group Wetherspoons rose after unveiling a 6.9% rise in like-for-like revenue in the first half. The company called the performance "reasonable" given the pressures on the UK consumer.
Imagination Technologies, which design GPUs (or graphics processing units), was extending gains made earlier in the week when it announced that its hardware would be used in the new Samsung Galaxy S4, which was unveiled in New York last night.
FTSE 100 - Risers
Hargreaves Lansdown (HL.) 929.50p +3.85%
International Consolidated Airlines Group SA (CDI) (IAG) 272.20p +3.62%
Fresnillo (FRES) 1,480.00p +1.58%
Anglo American (AAL) 1,892.50p +1.56%
Sainsbury (J) (SBRY) 362.80p +1.34%
Petrofac Ltd. (PFC) 1,547.00p +1.31%
Rexam (REX) 526.50p +1.25%
Aggreko (AGK) 1,989.00p +1.22%
Resolution Ltd. (RSL) 267.00p +1.14%
Royal Bank of Scotland Group (RBS) 307.90p +1.12%
FTSE 100 - Fallers
Aberdeen Asset Management (ADN) 411.30p -3.13%
HSBC Holdings (HSBA) 720.10p -2.69%
Melrose Industries (MRO) 264.60p -2.65%
Tate & Lyle (TATE) 818.00p -2.50%
Experian (EXPN) 1,158.00p -2.28%
Polymetal International (POLY) 916.00p -2.24%
RSA Insurance Group (RSA) 116.00p -2.19%
Babcock International Group (BAB) 1,071.00p -2.19%
Carnival (CCL) 2,379.00p -2.10%
Croda International (CRDA) 2,634.00p -2.08%
FTSE 250 - Risers
Rentokil Initial (RTO) 99.00p +9.39%
Centamin (DI) (CEY) 58.00p +8.41%
Ocado Group (OCDO) 183.30p +7.82%
Perform Group (PER) 504.00p +7.69%
Computacenter (CCC) 520.00p +7.30%
Playtech Ltd. (PTEC) 646.50p +5.46%
Dechra Pharmaceuticals (DPH) 759.50p +5.41%
Dunelm Group (DNLM) 853.50p +5.24%
Balfour Beatty (BBY) 278.10p +4.59%
Ted Baker (TED) 1,305.00p +4.57%
FTSE 250 - Fallers
Bwin.party Digital Entertainment (BPTY) 144.90p -4.36%
JD Sports Fashion (JD.) 768.00p -4.30%
IP Group (IPO) 135.90p -4.03%
UK Commercial Property Trust (UKCM) 67.00p -3.94%
Petropavlovsk (POG) 239.00p -3.75%
Workspace Group (WKP) 331.80p -3.55%
British Assets Trust (BSET) 130.00p -3.42%
Man Group (EMG) 100.30p -3.37%
Investec (INVP) 487.10p -3.35%
Dignity (DTY) 1,393.00p -2.93%