Drop in HSBC pegs back Britain's FTSE
* FTSE 100 flat in late session trading
* Fall at HSBC takes most points off the index
* Vodafone at 13-year high after Verizon Wireless deal
LONDON, Feb 24 (Reuters) - A slump in heavyweight bank HSBC pegged back Britain's top share index on Monday, threatening to end the market's six-day winning run.
The blue-chip FTSE 100 index was flat at 6,835.73 points in late session trading.
HSBC's 3.5 percent fall took the most points off the FTSE, after the bank posted lower-than-expected profits and warned about uncertain times for emerging markets, which have been hit by unrest in Ukraine and currency slumps in Argentina and elsewhere.
Concerns about emerging markets also hurt miners. The UK mining index slid 1.2 percent as media reports in China, the world's biggest metals consumer, stoked fears that local banks had begun tightening loans to property developers and some other sectors such as steel, cement and construction.
The FTSE 100 rose 14.4 percent in 2013 to post its best annual gain since 2009. The index is up by around 1 percent since the start of 2014, recovering from a fall in January caused by the downturn in emerging market economies.
However, Logic Investments' trading director Darren Easton said he would not buy the FTSE at current levels, preferring to wait and see if the index could break above its January peak of around 6,867.42 points.
"I'm still more bullish than bearish, but I'm not buying it up here," he said.
Cushioning the broader market's losses on Monday was a 3.1 percent rise in mobile telecoms group Vodafone, which hit a 13-year high on speculation the company might become a bid target after its deal to sell its stake in U.S. operator Verizon Wireless to U.S. peer Verizon.
Analysts said Vodafone's stake sale is set to prompt the largest capital return in corporate history, which should bring in fresh cash for major pension funds which own Vodafone shares and could use that cash to re-invest in the FTSE.
Beaufort Securities' chief investment strategist Mike Franklin was confident the FTSE would soon be able to hit the 6,900 point level and later challenge making a record high of 7,000 points.
However, JNF Capital trader Rick Jones expected the FTSE to consolidate around current levels in the near term, pointing to the fact that it was in technically "overbought" territory.
The FTSE 100 currently has a relative strength indicator (RSI) reading on a nine-day basis of just over 70. If a market has an RSI above 70, it indicates it is technically "overbought" while under 30 shows it is technically "oversold".
"The market looks a bit overbought right now, we might be running out of steam," said Jones.
- South Korea recovers first bodies from inside sunken ferry
- Japan expands army footprint for first time in 40 years, risks angering China
- Prosecutors extend Korea ferry captain's detention as death toll mounts |
- South Korea recovers first bodies from inside sunken ferry |
- Mediator heads to east Ukraine, seeking surrenders |