Britain's benchmark stock market made limited gains on Wednesday, as persistent worries over the euro zone debt crisis caused many investors to stay on the sidelines and prevented the index from advancing beyond peaks reached earlier this month.
The blue-chip FTSE 100 index was up 0.02 percent, or 1.22 points, at 5,474.96 points by 12:33 SA time.
Volumes were relatively thin, coming in at around 27 percent of the average 90-day volume on the FTSE. Several traders said they were not taking on too many positions on the FTSE, given the uncertainty over elections this weekend in Greece, which could determine whether or not Greece stays in the euro zone.
“The markets are very skittish at the moment, and it does look as though it could easily fall back from here,” said Securequity sales trader Jawaid Afsar.
The FTSE 100 is up around 5 percent from a low of 5,229.76 points reached on June 1, but is also down 1 percent from a peak of around 5,536 points reached a week later.
Traders said it was likely to stay within that tight range while the uncertainties over Greece and worries about Spain's debt-ridden banks persisted.
“It's a very tricky time to go long on the market,” said Central Markets chief strategist Richard Perry.
RESOLUTION RISES, IMI FALLS
British insurer Resolution was the best-performing FTSE 100 stock, rising around 2 percent, after broker UBS raised its rating on the stock to “buy” from “neutral.”
In contrast, engineer IMI was the worst-performing FTSE 100 stock, falling by 5 percent after Swedish manufacturing group SKF warned of a second-quarter slowdown which hit shares in companies throughout the industrials sector.
Securequity's Afsar said he had bought shares in insurer Resolution and food group Tate & Lyle, and had bought shares in miner ENRC while selling stock in rival commodities group Anglo American.
“We're trying to hedge ourselves. We're looking for stocks that are out of sync within their own sectors,” he said. - Reuters