UK shares turn lower on Greece, Mideast concerns
* FTSE 100 falls 0.2 pct, sheds early gains
* Traders cite Greece solvency worries, Mideast tensions
* Defensives outperform in uncertain market
By David Brett
LONDON, Oct 4 (Reuters) - UK shares turned lower on Thursday, hit by concerns over bailout talks in Greece and tensions in the Middle East, ahead of central bank meetings in Britain and Europe that are unlikely to generate new stimulus moves.
By 0836 GMT, the UK's FTSE 100
was down 12.53 points or 0.2 percent, at 5,813.29, with the index stuck in a 150-point range since mid-September when a central bank stimulus-fuelled summer rally ran out of steam.
"Caution remains the buzzword ... We are struggling to find catalysts for a further uptick," Mike van Dulken, head of research at Accendo Markets, said.
The market shed early gains following a report some euro zone states may want to delay the release of more bailout cash to Greece until November, with oil shares falling on geopolitical tensions linked to the civil war in Syria.
Defensive stocks that tend to benefit in a cautious economic environment - such as tobacco, dividend-rich Vodafone
and pharmaceuticals - outperformed the broader index.
rose 0.7 percent after the drugmaker's joint venture partner Shionogi-ViiV Healthcare announced completion of initial clinical registration package for dolutegravir in HIV.
Tate and Lyle
was the standout performer in early deals, up 2.7 percent, after Credit Suisse upgraded the sugar refiner to "outperform" from "neutral".
Investors bought the dip in banks
, which have fallen recently on the back of concerns lenders would need to raise further capital to meet regulatory requirements.
and Royal Bank of Scotland
climbed 1.3 and 1.1 percent respectively.
Interest rate decisions are due out from the Bank of England and the European Central Bank around midday with rates widely expected to remain at the record lows.
The main focus will be comments on the banks' stimulus measures in the wake of recent downbeat economic data in Europe.
Accendo's Van Dulken said the FTSE 100 remains in 3-4 month uptrend and possibly heading back to mid-Sept highs of 5,930, however, the longer-term graph suggested resistance a touch earlier at 5,920.
"Colour from the ECB ... could help the uptrend continue, as could more positive (non-farm payrolls) data from U.S. tomorrow. More bad news from China and more extra stimulus could help us higher into year-end, as could the traditional Santa rally," Accendo's Van Dulken said.
were the worst performing sector on the FTSE 100 with some risks seen ahead of the upcoming earnings season.
"We see some risk of negative earnings momentum for the group in the near term as companies start guiding on the quarter," Exane BNP Paribas said in a note, although it sees the sector's current valuation as undemanding.
Exane BNP Paribas' preference remains skewed towards growth names such as BG
fell 0.6 percent, extending the previous session's falls as analysts begin cutting forecasts for the UK's biggest retailer after it revealed its first decline in profits in 20 years on Wednesday.
London-listed shares in Russia's Evraz
shed 3.5 percent after the steelmaker announced a plan to issue 132.7 million new shares, or 9.9 percent of its existing share capital, to increase its share in coal miner Raspadskaya
to an indirect 82 percent holding.
(Written by David Brett; Editing by John Stonestreet)
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