FTSE ends down 1.1 percent

By David Brett

LONDON (Reuters) - London's top share index ended down 1.1 percent on Wednesday, hitting its lowest closing level in more than two months, as weakness in banks, oil producers and miners offset minor resistance in some defensives.

The FTSE 100 .FTSE closed down 46.77 points at 4140.23, its third day of losses.

The index has gained 20 percent since hitting a six-year low in March, but is still down 6.6 percent for the year.

"We've been looking for direction from America, which we haven't really got ... not helped by the fall in the price of oil," said Mark Priest, senior equities trader at ETX Capital.

"The trend at the moment is definitely in the southerly direction, unfortunately. Despite IMF talk that the recession is on its way (out), people remain unconvinced."

Banks were under pressure on the economic outlook and following plans set out by British finance minister Alistair Darling to strengthen regulation of financial markets to prevent a re-run of the credit crunch.

Royal Bank of Scotland (RBS.L), Barclays (BARC.L), HSBC (HSBA.L) and Lloyds Banking Group (LLOY.L) fell between 1.9 and 4.5 percent.

Crude futures fell 2.2 percent to below $61 and were headed to their sixth straight negative session, which pressurised shares in the energy sector.

Oil and gas producers BP (BP.L), BG (BG.L), Royal Dutch Shell (RDSa.L), Cairn Energy (CNE.L) and Tullow Oil fell between 0.4 and 3 percent.

Tullow Oil (TLW.L) dropped after saying it expected first-half revenue to fall 23 percent on lower oil prices.

Miners dipped against a backdrop of mixed metal prices and comments from South African Mineral Resources Minister Susan Shabangu who said complete recovery from recession is still a way off.

Fresnillo (FRES.L), Vedanta Resources (VED.L), Lonmin (LMI.L), Xstrata (XTA.L) and Anglo American (AAL.L) shed between 3.8 and 4.5 percent.

In a sea of red, gains were seen in pharmaceuticals as investors bought into sectors perceived as safe bets in an extremely risk averse environment.

GlaxoSmithKline (GSK.L) added 1.6 percent.

Telecom giant Vodafone (VOD.L) gained 0.9 percent after reaching an agreement with Deutsche Telekom (DTEGn.DE) that allows the British telecoms group to use the German incumbent's high-speed VDSL network in Germany.