FTSE inches down, pegged back by U.S. stimulus concerns
* FTSE 100 down 2.39 points
* U.S. stimulus worries weigh on sentiment
* Accendo targets 6,400, then 6,350
By Tricia Wright
LONDON, Dec 5 (Reuters) - Britain's top share index inched lower on Thursday, trading aound seven-week lows, with concerns over withdrawal of the U.S. Federal Reserve's stimulus preventing investors from making bets on the market.
The UK blue chip index was down 2.39 points at 6,507.58 points by 0850 GMT, having on Wednesday hit its lowest close since Oct. 14, at 6,509.97. The index has sunk nearly 5 percent from October's peak of 6,819.
"The correction is like a bad smell; it just won't go away," Mike van Dulken, head of research at Accendo Markets.
"The fact that we're struggling to break above the 200-day moving average at 6,509 is a negative. That could add to the weight of hurdles to clear to renew the uptrend."
Van Dulken said that should the index break through 6,470, this would pave the way for a drop to 6,400, followed by 6,350.
Uncertainty remains over when the U.S. Federal Reserve will start cutting its bond-buying programme, which has supported the rally in stocks. It has said it will start the process when certain economic data releases meet its targets.
Recent robust data has re-ignited speculation it could start the process before year-end, with a better than expected reading of the ADP National Employment Report on U.S. private-sector jobs on Wednesday raising expectations that Friday's jobs report will surprise on the positive side.
"We're not through the 'good news is bad news' phase quite yet - and I suppose if we get a strong payroll number tomorrow, then the talk about the tapering (being announced at the December meeting) will be back on the table again."
The equity market pull-back has disappointed investors who had reckoned on a festive rally this month - a trend which has seen the FTSE 100 rise in all but two of the last 20 Decembers, according to Thomson Reuters Datastream data.
But, this time, with the FTSE 100 already up around 10 percent in 2013 - more than in any of the previous three years - investors are in a more cautious mood.
"I think it is the case that the 'Santa rally' has already happened," Peel Hunt's Williams said.