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Blue chip shares end

lower in London

LONDON: Blue chip shares ended weaker on Wednesday, dented by UK data which cast doubt over the possibility of further cuts in UK rates.

Weakness in the Dow also contributed to the softer tone but dealers took some encouragement from the FTSE 100's ability to hold above the 3,800 level.

The leading index closed 19.7 points off at 3,805.6, having touched a new intra-day high of 3,839.7. But second-line stocks continued higher, ending 5.6 points up at a new closing best of 4,464.1.

Equity turnover was moderate at 763 million shares.

The Dow was showing a fall of around 34 points at the time London closed.

News that UK unemployment dropped by a seasonally-adjusted 25,700 in March and average earnings rose 3.5 percent surprised the market, depressing gilts and shares.

Analysts had been forecasting a 5,000 rise in the jobless figure and a 3.25 percent rise in earnings.

"The figures upset the gilt market more than us and there hasn't been that much selling and it showed - we ended above 3,800 (FTSE 100)," said one senior trader.

"The mood seems to one of "wait and see'. It's more a case of interest rates being on hold for the time being rather than anything else, although the (UK) monetary meeting details did have some impact," the senior trader added.

The June long gilt futures lost 20/32 to 105-9/32 after the minutes of the policy meeting between Chancellor Kenneth Clarke and Bank of England Governor Eddie George revealed Clarke that is ready to put rates up later this year if necessary.

Gilts and equities face the hurdle of tomorrow's release of UK Public Sector Borrowing Requirement and retail price data for March due at 0830 GMT.Reuter