Steady day after Tuesday's turmoil

LONDON FTSE 100 CLOSE 4,916.87 +2.65

Britain's benchmark share index closed largely unchanged yesterday after a choppy session on the last day of the month and following Tuesday's slide.

At the close, the FTSE 100 was up just 2.65 points or 0.05 per cent at 4,916.87, notching up a 13.4 per cent decline for the second-quarter - the worst performance since the third quarter of 2002 when the dotcom boom collapsed.

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Mic Mills, head of electronic trading at ETX Capital, said: "It's been a very tough quarter, with the European debt crisis and BP's environmental disaster weighing heavily.

"Given Tuesday's plunge, there was rather likely to be a little bounce today. But with the (United States] non-farm payrolls on Friday, investors remain very cautious."

Worries about the imminent repayment of loans made to banks by the European Central Bank (ECB) have been having an impact on shares.

But the ECB later said that it had lent a smaller-than-expected 107 billion in three-month money to banks refinancing the loans, easing balance sheet fears.

In currency news, the pound's recent strong run stalled, with sterling down 0.6 per cent to just less than $1.50 to the pound and it was off 1.5 per cent against the euro at €1.22.

The Footsie risers were led by AstraZeneca after the pharmaceuticals giant won a three-year battle over its Crestor cholesterol drug, which will keep cheap, generic rivals at bay in the United States until 2016.

The shares jumped 222p to 3,169p on the news, while fellow drugs giant GlaxoSmithKline added 20p to 1,143p.

BP was second on the risers board as broker speculation about the prospect of a bid from ExxonMobil once the Gulf of Mexico situation has stabilised meant that the beleaguered UK company pulled clear of its recent 14-year lows. Shares were 5 per cent higher, up 16p to 318.9p, during a generally better session for commodity-based stocks. Other risers in the oil sector included Edinburgh-based Cairn Energy, which lifted 6.7p to 414.9p.

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Barclays led a strong session for banks after it set out new targets for its UK retail banking and Barclaycard division over the next three years.

The plans, which were unveiled at the start of an investor briefing, included a 1 billion spend on improving customer service over four years. Shares jumped 3.2p to 270.6p. Royal Bank of Scotland dipped 0.34p to 41.43p and Lloyds Banking Group, which announced fresh job cuts, slipped 0.11p to 53.7p.

Outside the top flight, shares in housebuilders were under pressure after Nationwide said the average cost of a property crept ahead by just 0.1 per cent in June.

Taylor Wimpey fell 2p to 26.4p or 7 per cent while Redrow slipped 6.3p to 112.9p.

Resolution was one of the leading risers in the FTSE 250 index, up 3p to 63.3p as its shares traded for the first time since its deal to buy the UK life and pensions operation of Axa.

It was joined on the way up by social housing firm Connaught, which has tumbled since a warning on Friday that George Osborne's emergency Budget will hit revenues and profits. Shares, which were at 325p last week, rose 8.1p to 115.3p yesterday.