* FTSE 100 falls 0.5 percent; no MPC, Fed surprises
* Banks, energy stocks fall
* Miners, Imperial tobacco gain
By Simon Falush
LONDON, Sept 22 (Reuters) - Weaker banks and energy stocks,
weighed by nagging concern about the state of the U.S. economy,
helped drag Britain's top shares lower around midday on
Wednesday.
By 1052 GMT the FTSE 100 <> was down 27.48 points or
0.5 percent at 5,548.71 after it fell 0.5 percent on Tuesday.
Banks, which tend to be sensitive to even slight shifts in
risk appetite, were the biggest drag on the index, with Lloyds
Banking Group <LLOY.L> off 1.1 percent and HSBC <HSBA.L> 0.9
percent weaker.
Banks were also weighed down by a statement from German peer
Deutsche Bank <DBKGn.DE> which hurt bank shares late on Tuesday.
The bank said sales and trading activity during July and
August was weaker than a year ago, providing a warning shot that
third-quarter investment banking earnings could be weak across
the board. []
Markets retreated on Tuesday on nervousness ahead of the
Fed's statement on monetary policy, published after London's
close.
In the event, the U.S. central bank nudged the door wider to
pumping more money into the economy but kept overnight interest
rates unchanged near zero, as expected. []
U.S. stocks initially popped higher after the Fed statement,
but gave back those gains quickly and ended flat.
Some investors had hoped that with recent improvements in
economic data, the Fed would issue a more upbeat outlook or
clarify the measures it would take to stimulate demand.
But in the absence of any positive surprises, investors took
the statement as an excuse to sell equities after a 13 percent
gain in the FTSE 100 so far in the third quarter.
"We're seeing a bit of nervousness, investors are pulling
back after we've seen the best part of 700 point rally in the
last four or five months," said Giles Watts, head of equities at
City Index.
Minutes of the Bank of England's Monetary Policy Committee
meeting on Sept 8-9 showed BoE policymaker Andrew Sentance had
repeated his lone call for an interest rate hike while some of
his colleagues thought the probability that more monetary easing
would be needed had increased.
Energy stocks retreated as fears on the demand outlook
weighed on the sector. BP <BP.L> and Royal Dutch Shell <RDSa.L>
fell 1.6 and 0.5 percent respectively.
Miners bucked the trend, however as metal prices firmed with
gold <XAU=> hitting a record peak. Randgold Resources <RRS.L>
and African Barrick Gold <ABGL.L> both rose around 2.2 percent
respectively, while Rio Tinto added 1.8 percent.
TOBACCO GAINER
Imperial Tobacco <IMT.L> was the other standout gainer,
adding 1.6 percent after it said its key global cigarette brands
continued to perform well and announced volumes in line with its
expectations. []
With the market hemmed in a fairly tight range, investors
were also eying technical levels.
"(There is) support around 5,505/10, the lows of the last
week or so, while below that there should also be some interest
around 5,435 which was the old 61.8 percent retracement level of
the down move from the highs to the lows of this year," said
Michael Hewson market analyst at CMC Markets.
He added that the index needs to consolidate itself above
5,600 to re-target the 5,800 highs.
Across the Atlantic, after Tuesday's Federal Reserve
meeting, investors will have the latest weekly U.S. mortgage and
refinancing indexes to assess on Wednesday afternoon, together
with the July FHFA Home price index.
Among stocks in retreat, Weir Group <WEIR.L> fell 3.1
percent after RBS cut its rating on the stock to "hold" from
"buy" on valuation grounds.
Ex-dividend factors clipped 1.19 points off the FTSE 100
index on Wednesday, with Aggreko <AGGK.L>, Aviva <AV.L>, and
Petrofac <PFC.L> all losing their payout attractions.
(Editing by Hans Peters)
