FTSE 100 managed to close in positive territory as Wall Street was mixed and the pound strengthened.
The UK blue-chip index finished over 44 points higher at 7,044, but big miners tempered gains.
In contrast, the mid-cap FTSE 250 shed over 32 points to close at 19,356.
Fiona Cincotta, the senior market analyst at City Index, said: "After spending much of the day in the red, a stronger start on the Dow and bid interest in Shire Pharmaceuticals pushed the FTSE higher.
"Shire is up over 17% on the day amid confirmation of preliminary interest from Japanese Pharma Group Takeda."
At the close, Shire Plc (LON:SHP) was in fact around 14% higher, at 3,500p.
"The bid interest from Takeda comes hot on the heels of GSK buying out Novartis from a consumer health joint venture, resulting in a 6.5% rally for pharmaceuticals over the past 5 days and a 7% rally for the sector across the past 30 day, outperforming the FTSE, which sunk 2.9% over the same period," noted the analyst.
The top loser on Footsie was Evraz (LON:EVR), which lost 6.05% to 425.20p.
Sterling added 0.11% against the Euro, and was down 0.36% against the US dollar.
The FTSE 100 index turned flat in late afternoon trading as an opening rebound in New York on strong US GDP data was soon reversed amid ongoing worries for tech stocks.
Around 2.45pm, the UK blue chip index was up about 2.0 points at 7,001, having fallen back from the session peak of 7,016.60 after a rally from the day's low of 6,923.33.
In opening deals on Wall Street, the Dow Jones Industrials Average shot over 120 points higher, bouncing after sharp falls on Tuesday helped by an upgrade to US GDP numbers, but that gain was soon eroded to 24 points at 23,882,l while other key indices were lower.
The US economy grew by 2.9% in the fourth quarter of 2017, revised up from an earlier reading of 2.5% growth, reflecting the biggest increase in consumer spending in three year. Economists had forecast an annualised reading of 2.8%.
The US technology sector was under pressure once again, having precipitated a near 345 points slide by the Dow on Tuesday, extending a recent bout of weakness that has made it one of the worst-performing sectors in March.
However, Facebook Inc. shares (NASDAQ:FB) rallied 0.8% higher having been one of the biggest drags on the tech sector this month, with the social media giant slumping more than 14% following a scandal over how it has handled user data.
In London, M&A news injected some life into the FTSE 100, with Shire Plc (LON:SHP) shares jumping 17% higher to 3,6906p after Japanese rival Takeda Pharmaceutical said it was considering a bid for the drugmaker.
But miners were a drag as a swing in the dollar hurt metals prices, with Antofagasta PLC (LON:ANTO) dropping 4% to 909p and Rio Tinto PLC (LON:RIO) off 2.8% at 3,500p among the biggest fallers.
Insurer Aviva PLC (LON:AV.) was also lower, down 0.7% at 494.7p as the Financial Conduct Authority said it was considering whether to launch a formal investigation into its decision to ditch plans to cancel its preference shares.
G4S PLC (LON:GFS) was a FTSE 100 gainer in early afternoon trading, adding 1.7% to 246.3p as HSBC Securities upped its stance on the support services firm to 'hold' from 'reduce', with an increased target price of 245p from 230p, citing valuation grounds.
In a European sector review entitled 'Cash and Security', the global bank's analysts said: "With potential for delays in contract conversion, and wage inflation headwinds, we do not consider these positives ample enough to offset the risks completely. However, the multiple de-rating limits the downside potential."
Another blue chip gainer was Unilever plc (LON:ULVR), which added 2.9% to 3,846p as UBS upgraded to the stock to 'buy' from 'neutral', saying its recent underperformance creates a "compelling entry point".
The consumer goods company's shares have pulled back about 18% since their peak in October but UBS sees upside from its restructuring.
Unilever spent most of last year reviewing its business after rebuffing a US$143bn takeover bid from Kraft Foods in February 2017.
US stock index futures swung higher half-an-hour ahead of the US restart, pointing to a recovery by the Dow Jones Industrials Average after sharp falls on Tuesday, helped by an upgrade to US GDP numbers.
The US economy grew by 2.9% in the fourth quarter of 2017, revised up from an earlier reading of 2.5% growth, reflecting the biggest increase in consumer spending in three years and higher investment in business inventories. Economists had forecast an annualised reading of 2.8%.
US #GDP +2.9% in Q1 final estimate w/ consumer spending & inventories contrib revised +0.2pp each. Real final sales +3.4% & sales to domestic purchasers +4.5%! Q4 GDP momentum 2.6% y/y. While @OxfordEconomics sees modest +1.8% (saar) in Q1, momentum should accelerate through 2018 pic.twitter.com/onTgngZHe8
- Gregory Daco (@GregDaco) 28 March 2018Dennis de Jong, managing director at UFX.com, commented: "Robust jobs growth and healthy consumer spending have been attributed to today's stronger than expected US GDP data, as the country's economic outlook appears in rude health and the 3% growth target appears within touching distance."
He added: "As a result of the strong economic outlook, questions may be raised around the possibility of Fed Chair Jerome Powell introducing a June rate hike.
"It may be a case of US growth being monitored before any rate decision is made, but markets could be volatile between now and then."
Expectations for an opening rally on Wall Street pushed the FTSE 100 index in London up a session peak of 7,012.25, though around 2pm it had drifted back to gains of around 5 points at 7,005.
The Footsie managed to post modest gains in lunchtime trading, recovering from early hefty falls boosted by news of a takeover approach to drugs blue chip Shire Plc (LON:SHP).
Around 1.00pm, the UK blue chip index was up 2 points at 7,002, having rallied from the session low of 6,923.33.
Shire shares shot 16% higher to 3,565p after Japan's Takeda Pharmaceutical Company Ltd confirmed it is considering a takeover approach for the FTSE 100-listed company.
Takeda said its consideration of a possible offer for Shire is at "a preliminary and exploratory stage" and there can be "no certainty" that an approach will be made.
Investors remained cautious, however, ahead of the US restart, with the Dow Jones still expected to open lower following Tuesday's 300 point-plus slide as tech stocks continue to come under pressure on Facebook Inc (NASDAQ:FB) probe worries.
Chris Beauchamp, chief market analyst at IG, commented: "The bounce on Tuesday looks like a flash in the pan, with more and more investors heading to the exit.
"It is looking increasingly likely that we have a re-run of August 2015 on our hands; equities then had months of volatility to contend with before the rally resumed. With trade wars and the tech scandal weighing on sentiment we may well have more downside to content with."
UK retail sales fell for the first time in five months in March as heavy snowfall combined with the financial strains on many households, according to a survey by the Confederation of British Industry.
The CBI distributive trades survey's retail sales balance fell to -8 from +8 in February, well below economists's median forecast of +15.
Ben Jones, a CBI economist, said: "Against a backdrop of stagnating household incomes and weak consumer confidence, the lengthy cold snap earlier this month has heaped added pressure on retailers."
A measure of sales for the time of year was the weakest since April 2013, the survey showed. Retailers expected sales volumes and orders to grow in April but only at a subdued pace.
Retailers were mixed on the FTSE 100 index, with clothing stores firm Marks & Spencer PLC shedding 0.5% at 265.3p, but rival Next Plc (LON:NXT) ahead 0.3% at 4,809p.
Meanwhile, Primark clothing chain owner Associated British Foods plc (LON:ABF) saw its shares rise 1.1% to 2,451p as Morgan Stanley upgraded the stock to 'overweight' from 'equal-weight' as it think's the retail arm's profits are likely to 'inflect positively' in a 12-month time frame.
Overall, the FTSE 100 index was 16 points lower at 6,983 but remained well off the day's low of 6,923.33 even though US stocks are still expected to start lower on Thursday following a near 345-point slide in the previous session.
On currency markets, sterling remained fairly subdued, losing less than 0.1% against both the dollar and the euro, at US$1.4150 and ?,?1.1416 respectively.
Sky PLC's (LON:SKY) online gambling arm, Sky Bet has been fined ?1mln by the UK industry regulator for allowing hundreds of "potentially vulnerable" people to keep betting after they asked to be barred from doing so, while sending promotional material to 50,000 more, the Guardian newspaper has reported.
It said the Gambling Commission said Sky Bet was guilty of failings in its self-exclusion tools, which are meant to help people who fear they have a gambling problem lock themselves out of online casinos and sports betting.
The fine comes amid delays to the launch of an industry-wide system called GamStop designed to allow addicts to block themselves from multiple companies, following high-profile problems with individual firms' self-exclusion schemes, the newspaper added.
In late morning trading, FTSE 100-listed Sky saw its shares shed 0.4% at 1,311p.
Overall, the UK blue chip index was down 23 points at 6,976, albeit well above session lows on expectations that US stocks will be slightly steadier at the open on Thursday following the previous session's 340 point-slide by the Dow Jones Industrials though more losses are still expected on Wall Street.
David Morrison, senior market strategist at GKfX.com has said he thinks that the upcoming Easter break "couldn't really come at a worse time for stock markets."
The strategist noted: "Investors were already on edge having been shocked by February's equity sell-off triggered by the dual spike in volatility and bond yields. Despite a strong rebound, the major stock indices remain fragile with many in danger of breaking back below some major technical levels - in particular, the lower level of the S&P's bullish trendline advance since February 2016.
"This has been brought sharply into focus with the sell-off in tech stocks, which have lead the market rally for so long, catalysed by the scandal surrounding Facebook's cavalier attitude to its users' data."
Morrison continued: "Now we have a long holiday weekend which coincides with the close of the first quarter. Once again, bonds are in focus - particularly the US 10-year Treasury. But this time yields have slumped with the 10-year crashing back below the key 2.80% level which has held as support for the past six weeks.
"Investors are piling back into the perceived "safe haven" of fixed income as stock markets slide. Yet this is happening even as the spread of LIBOR over OIS (a key measure of market risk) widens to levels not seen since November 2008, at the height of the financial crisis."
He concluded: "Analysts are busy drawing parallels with chart patterns going back to 1929 and 1987. And this comes against a backdrop of tighter monetary policy from the Federal Reserve, concerns over the outbreak of trade wars and worries about changes in key White House personnel leading to a more hawkish foreign policy.
"All-in-all, investors will see plenty of reasons to reduce equity exposure as we head into the weekend."
With that sort of cautious comment, the FTSE 100 index remained pretty depressed in late morning trading, shedding around 38 points at 6,961, losing a chunk of Tuesday's rebound but holding off the session low of 6,923.33.
There was more activity in the drugs sector this morning, with shares in Shire Plc (LON:SHP) rising after Japanese firm Takeda Pharmaceutical Company Limited confirmed that it is considering making an approach to FTSE 100-listed firm regarding a possible offer for the company.
In a statement noting the rise in Shire's share price, Takeda said "consideration of such an offer is at a preliminary and exploratory stage and no approach has been made to the Board of Shire. There can be no certainty that an approach, if made, will lead to any transaction."
The Japanese firm added that it believes a potential transaction with Shire presents an opportunity to advance its "stated Vision 2025, build on its current strong momentum, and create a truly global, value-based Japanese biopharmaceutical leader."
In mid-morning trading, Shire shares were up 2.6% at 3,150p, having drifted off the session peak of 3,250p.
The FTSE 100 index, however, remained in the doldrums, shedding 45 points at 6,953, albeit above the day's low of 6,923.33.
BT Group plc (LON:BT.A) will have to reduce the price it charges rivals to use its fast broadband services, regulator Ofcom said.
Ofcom said BT will also have to make the access to its infrastructure easier.
"BT must make its telegraph poles and underground tunnels open to rival providers, making it quicker and easier for them to build their own full-fibre networks directly to households around the UK," the regulator said.
The cap on the monthly charge will be gradually reduced to ?12.06 a month by 2020/21, which is higher than the ?11.92 proposed by Ofcom in February.
Ofcom has decided against regulating the prices of Openreach's fastest wholesale broadband products, including those delivered using its new full-fibre services.
The announcement comes as BT looks to roll-out its fibre networks across the UK to improve broadband speeds.
Shares in DFS Furniture Plc (LON:DFS) are up more than 8% to 183p after saying it remains confident of delivering modest earnings growth this year despite a decline in profit and sales in the first half.
Neil Wilson, senior market analyst at ETX Capital, said: "Broadly speaking, DFS is managing to handle the broader downturn in retail pretty well. The collapse of Feather & Black, Warren Evans and Multiyork, whose assets DFS has acquired, served to indicate the severe pressure on the market and the opportunity for those with enough scale to see it out."
He added: "As we have noted on several occasions, this company has been here before, coping with recessions and property market downturns that prevent customers splashing out on big ticket items. Whilst there is no doubt the market is in a bad place - and remains that way despite the encouraging signs from at the start of H2 - the company is on course to deliver modest earnings growth and strong cash generation this year."
The FTSE 100 unwound a chunk of Tuesday's rally in early trading, dropping back in tandem with a sharp turnaround overnight on Wall Street and falls by Asian markets as tech stocks tumbled on worries over the implications of the Facebook Inc (NASDAQ:FB) saga.
Around 8.45am, the FTSE 100 index was down around 49 points at 6,950, giving back around half of Tuesday's 111 points advance.
Naeem Aslam, chief market analyst at Think Markets UK Ltd said: "This rolling over in tech stocks looks set to weigh on European markets this morning, with a lower open as markets mull over the potential for uncertainty over a tech sector that could catch a cold as a result of Facebook's woes around user data."
He added: "With the increasing focus on what is going with respect to how Facebook has managed its users personal data, it must surely be only a matter of time before attention turns to the rest of the tech sector, and how companies like Alphabet, Twitter, Microsoft and Apple to name a few, manage their own users personal data.
"If lawmakers do turn their attention to the rest of the sector, which seems likely, then it is hard not to see how other tech companies will escape scrutiny on how they use this user data, raising the prospect that we could uncover other practices that invite scrutiny."
With few tech stocks listed among the London blue chips, the main drag on the FTSE 100 index came from heavyweight mining stocks as the overall market declines impacted commodity prices, with Antofagasta PLC (LON:ANTO) shedding 2.6% at 923p, while BHP Billiton plc (LON:BLT) lost 1.9% at 1,377p.
Emerging markets-focused investment group Old Mutual PLC (LON:OML) was the biggest blue chip faller, down 3% to 234.9p.
Among the minority gainers, luxury goods firm Burberry PLC (LON:BRBY) edged 0.1% higher to 1,671.5p supported by an upgrade from Goldman Sachs, which raised the stock to its 'Conviction Buy' list.
LoopUp Group PLC (LON:LOOP) has commercially launched into the Australian market with the formal opening of an office in Sydney. The AIM-listed remote meeting solution provider said the US$275mln development would augment a datacentre already in the country, which it has operated since 2016 to serve its UK and US customers, with a target focus on Australian-based enterprises.
Gfinity Plc (LON:GFIN) confirmed on Wednesday that it is raising ?6.7mln via a placing and sUBScription of 55.8mln new ordinary shares at a price of 12p each to expand its Gfinity Elite esports series as it also delivered first-half results showing a doubling in revenue.
Collagen Solutions PLC (AIM:COS) said it expects to reach "a profitable state more quickly than previously planned" following the restructure of its New Zealand operation. The proposal, which is subject to an employee consultation process, would see the division focus on tissue collection and processing, a segment estimated to be worth US$100mln.
WYG PLC (LON:WYG) has said it expects its full-year revenue and operating profit to be in line with current market expectations of ?155mln and ?3.5mln respectively before separately disclosed items and share-based payments that are expected to be approximately ?8.5mln.
Connemara Mining Company PLC (LON:CON) has re-commenced drilling at its 100%-owned Mine River Gold project at Wicklow/Wexford in Ireland, boring 10 drill holes totalling 1,000 metres.
Renewable energy specialist Aggregated Micro Power Holdings plc (AIM:AMPH) looks set book a significant uplift to the value of its investment in an exchange traded products business which is raising capital. AMP holds a 27.89% stake in IncubEx, which plans to offer up to US$5mln Class B-1 units, valuing the business at US$50mln pre-money.
Strategic Minerals Plc (LON:SML) plans to carry out an initial exploration drilling programme at the Mount Weld tenements in Western Australia. The company said a technical review of the tenements, which are held by its wholly-owned sUBSidiary Central Australian Rare Earths, have identified a number of early targets considered to have good potential for gold and rare earth element mineralisation.
South African gold miner Pan African Resources plc (LON:PAF) is to carry out a feasibility study at Royal Sheba at the Barberton complex to assess its viability. A new estimate suggests Royal Sheba contains a potential 720,000oz of gold or double the previous resource.
Harvest Minerals Limited (LON:HMI) has announced that the application to register its multi-nutrient natural fertiliser, KPfertil has been processed by the Ministry of Agriculture (MAPA) in Brazil.
W Resources PLC (LON:WRES) said its sUBSidiary, Iberian Resources Spain SL (IRS), has been awarded a ?,?5.3mln grant by the government of the Extremadura region of Spain. The AIM-listed tungsten-focused miner said the grant was for IRS's La Parrilla tungsten and tin project in the region and equated to 32% of the ?,?16.6mln plant and facilities package that qualified for grant contribution.
Lab testing has indicated potentially higher recoveries of lithium than previously predicted at the Cinovec deposit in the Czech Republic, according to European Metals Holdings Limited (LON:EMH).
A huge increase in the contribution from its Kestrel coal royalty in Australia helped Anglo Pacific Holdings PLC (LON:APF) to record revenues. Total royalty income in 2017 rose by 90% ?37.4m, but it was Kestrel, which is being mined by Rio Tinto, that stood out.
Irish oil explorer Providence Resources PLC (LON:PVR) has finally found a partner for its Barryroe project in the Celtic Sea. A Chinese consortium led by Apec Energy has agreed to take a 50% interest in the project in return for the cost of three wells and associated side-tracks.
ImmuPharma PLC (LON:IMM), the specialist drug discovery and development company, announced that it has with immediate effect appointed Bryan, Garnier & Co. Limited as its joint corporate broker to act alongside Northland Capital Partners who remain the company's nominated adviser and joint corporate broker.
Savannah Resources Plc (LON:SAV), the AIM-quoted resource development company, announced that it has approved the settlement of the first deferred consideration tranche in accordance with the terms of the acquisition of the company's portfolio of Portuguese lithium projects in May 2017.
Metminco Limited (LON:MNC) (ASX:MNC) said that, further to its announcement dated 23 March 2018, it has successfully raised a total of approximately A$152,640 (before costs) from sophisticated and professional investors through the issue of 19,080,045 new ordinary shares in a placing. The company said subscribers will also receive one option exercisable at $0.011 on or before 1 June 2020 for every three placement shares subscribed for, subject to shareholder approval at the upcoming Annual General Meeting.
The FTSE 100 looks set to open sharply lower, hit by the tech sell-off in the US after hours, which also had a knock-on impact on Asia's main markets.
The spread betting firms are predicting a 50-point fall in the UK blue-chip index to 6,950.14, following the 345 point drop of the Dow Jones and 211 point slide in the NASDAQ index.
Spooking the market is the unfolding scandal about the harvesting and use of Facebook data, which traders fear could lead to wholesale regulation of social media and the internet.
"If lawmakers do turn their attention to the rest of the sector, which seems likely, then it is hard not to see how other tech companies will escape scrutiny on how they use this user data, raising the prospect that we could uncover other practices that invite scrutiny," said Michael Hewson, analyst at CMC Markets.
Interims from sofas group DFS Furniture (LON:DFS) and a trading statement from tour operator TUI AG (LON:TUI) are the highlights of a rather sparse corporate calendar as the City winds down for Easter.