* ENRC and Kazakhmys slump on Kazakhmys' ENRC impairment
* Wolseley falls after posting H1 profit drop
* Worries over Cyprus deal weigh on sentiment
By Sudip Kar-Gupta
LONDON, March 26 Worries over Cyprus's bailout
weighed on Britain's benchmark share index on Tuesday, while
drops at miner ENRC and plumbing supplies group
Wolseley also pegged back the market.
The blue-chip FTSE 100 index was flat at 6,380.46
points in choppy trade, slightly recovering from a 0.2 percent
fall on Monday.
Central Markets chief strategist Richard Perry said that
while uncertainty over the Cyprus bailout remained, the FTSE
would be increasingly at risk of a more prolonged sell-off.
The FTSE remains up by 8 percent since the start of 2013, as
global equity markets have been supported by world central
banks' pledges of liquidity to fight the effects of the euro
zone debt crisis and the uncertain economic outlook.
Perry said he would keep a long-term bullish view on the
index provided that any falls caused by the Cyprus situation did
not push the index below last month's lows of around 6,210
"Technically, it's still hanging onto a positive outlook.
The uptrend remains broadly intact, so the recent pull-back may
still turn out to be just a consolidation. But if it falls below
that February support level, I would start to get more worried,"
FALLS AT WOLSELEY AND ENRC
Miner ENRC slumped 5.5 percent while rival
Kazakhmys also dropped 10.4 percent, after Kazakhmys
said it had taken a $2.22 billion impairment on the value of its
stake in ENRC.
Wolseley provided another drag on the FTSE 100, falling 1.6
percent after a 20 percent drop in interim pre-tax profits, with
earnings hurt by the weak European economy.
"Wolseley would have benefited from earlier action to stem
the pain in Europe," said Mirabaud Securities equity research
partner Steve Clayton.
Lingering worries over the Cyprus deal also hit major UK
banking stocks, which risk being exposed if any fall-out from
Cyprus impacts other European banks, with Lloyds and
Barclays falling between 1.4 and 1.5 percent.
The tough terms of the Cyprus deal, which has seen Cyprus
agree to close its second-largest bank and inflict heavy losses
on big depositors, has raised worries over future euro zone
"The peripheral European banking system is still fragile and
there is a chance that further bailouts may be necessary,"
Espirito Santo wrote in a research note.
(Reporting by Sudip Kar-Gupta; Editing by Catherine Evans)