FTSE retreats, investors jittery before Fed meeting
* FTSE 100 down 0.5 percent
* Conclusion of Fed policy meeting on Wednesday eyed
* Support seen for FTSE at 6,460 - analysts
By Tricia Wright
LONDON, Dec 17 (Reuters) - Britain's top shares fell on Tuesday as investors preferred caution before the U.S. Federal Reserve was expected to consider whether to start cutting back its equity friendly stimulus measures at a policy meeting.
The FTSE 100 was down 34.66 points, or 0.5 percent, at 6,487.54 points by 0843 GMT, having risen 1.3 percent on Monday aided by robust U.S. manufacturing output data which provided more evidence that economic growth is gaining traction.
A majority of economists expect the Fed to begin reducing its bond buying operations in March, but a recent run of upbeat U.S. economic data along with last week's breakthrough budget deal in Washington has led some to speculate that the central bank will start the process as early as Wednesday, the conclusion of this week's two-day meeting.
Market sentiment is becoming more relaxed about a change in policy.
"(Yesterday's gains) could imply that the idea of tapering is something that investors are starting to get used to because obviously it's only going to be introduced at such time as the U.S. economy can withstand it," said Richard Hunter, head of equities at Hargreaves Lansdown.
But charts pointed to more weakness on the FTSE which, on Tuesday, fell below its 200-day moving average, currently at 6,515, having recaptured it in the previous session.
"A downward-sloping trend line, which comes in at around 6,600, is still intact. Thus the FTSE could head ... lower over the coming days. The next level of support is seen around 6,460, followed by 6,350," said Fawad Razaqzada, technical analyst at Gain Capital.
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