The pound gained ground after official figures showed a 1.2 per cent leap in UK retail sales last month thanks to the unseasonally warm weather and as shoppers took advantage of falling prices.
But the benchmark FTSE 100 Index struggled to make headway, closing up just 6.21 points at 7,013.47, with poor economic data from China and Europe weighing on the top flight.
Jasper Lawler, market analyst at CMC Markets UK, said: “There wasn’t too much in the way of action in European shares on Thursday after mixed service and manufacturing data suggested Europe’s economic expansion was coming off the boil in May.
“Much stronger-than-expected retail sales in the UK for April sent the pound roaring higher but didn’t do much to bolster a lacklustre FTSE 100 that has been languishing around the 7,000 mark all week.”
Shares in Dragon Oil were up 5.4 per cent at 680p as Emirates National Oil Company (ENOC) outlined a possible cash offer of 735p per share, valuing Dragon at some £3.6 billion.
The stand-out performance was from cash-and-carry group Booker in the FTSE 250 as investors cheered its announcement that it was to buy retail chains Londis and Budgens for £40 million.
Shares rose 12 per cent, or 18p, to 170p as the group boosts its scale amid the ongoing supermarket price war.
In other corporate news, Mothercare rose strongly after its results showed it halved annual losses and grew same store sales for the first time in five years as the babywear retailer begins to see the results of its turnaround plan. Shares rose 5 per cent, or 10.25p, to 235p.