* FTSE 100 down 0.1 percent
* August U.S. retail sales data eyed; due at 1230 GMT
By Tricia Wright
LONDON, Sept 14 (Reuters) - Britain's top shares were
slightly lower at midday on Tuesday, as falls in tobacco stocks
offset continued strength from banks, ahead of U.S. retail sales
data and after shrugging off domestic inflation data.
By 1112 GMT, the FTSE 100 <> was 3.48 points, or 0.1
percent, lower at 5,562.05, having closed 1.2 percent firmer at
5,565.53 on Monday, a fresh four-month closing high.
Gains were seen among banks <.FTNMX8350>, with HSBC <HSBA.L>
and Standard Chartered <STAN.L> putting on 0.5 percent and 0.9
percent respectively, though Barclays <BARC.L> and Lloyds
Banking Group <LLOY.L> both fell 0.2 percent.
"I think in the UK and in Europe this morning we saw a
little bit of a re-evaluation after the big ramp-up in stocks
after Basel III," David Morrison, market strategist at GFT
Global said.
"Perhaps a few concerns that although there are eight or
nine years for the increased capital requirements to come into
play, there might nevertheless be banks following Deutsche Bank
and wanting to come to market sooner rather than later."
Royal Bank of Scotland <RBS.L> was the best sector
performer, rising 1.1 percent. RBS said it planned to sell 4.7
billion pounds of mortgage-backed securities in its first such
deal since the onset of the credit crisis.
British inflation defied expectations of a fall in August
and held steady at the level that last month forced the Bank of
England to write a public letter to explain why prices were
rising so fast. []
Outsourcing group Capita <CPI.L> grabbed top spot on the
FTSE 100 leader board, adding 2.8 percent, while midcap peer
Logica <LOG.L> also rose after Capgemini UK announced it has
signed a MoU with the UK government which reassured investors
about public sector contracts.
Defence group Cobham <COB.L> was another good gainer, up 2.1
percent after Credit Suisse upgraded its rating on the stock to
"outperform" from "neutral", saying it has increased its
earnings per share estimate for 2010.
U.S. OPEN AWAITED
U.S. stock index futures <DJc1>, <SPc1>, <NDc1> pointed to a
mixed start on Wall Street on Tuesday, ahead of August U.S.
retail sales data, due at 1230 GMT, which will provide further
clues as to the strength of the U.S. economic recovery.
Economists expected a 0.3 percent rise compared with a 0.4
percent increase in July. Investors were also waiting for U.S.
business inventories for July, due at 1400 GMT.
"We are now looking ahead to the U.S. open. Technically, the
U.S. indices certainly have some room to the upside before they
test this major resistance band which is about another 1 percent
above where we are at the moment," GFT Global's Morrison said.
Defensive tobacco stocks were under pressure, with Imperial
Tobacco <IMT.L> falling 1 percent, while British American
Tobacco <BATS.L> dropped 0.9 percent.
TUI Travel <TT.L> shed 1.2 percent, after BofA Merrill Lynch
cut its rating for the tour operator to "neutral" from "buy" and
reduced its target price to 230 pence from 270 pence in a review
of the European sector.
Next <NXT.L> dropped 1.5 percent after Societe Generale cut
its rating on the fashion chain to "sell" from "hold" ahead of
first-half results on Wednesday.
(Editing by Dan Lalor)
