* FTSE 100 down 0.2 percent; close to 5,800 technical level
* Wolseley among top fallers; analysts cite Europe concerns
* Spain bailout uncertainty holding back equity markets
By Sudip Kar-Gupta
LONDON, Oct 2 (Reuters) - Britain's benchmark share index edged lower on Tuesday, with sentiment driven by concerns about Europe that traders said could drive the market down further.
Uncertainty about when Spain might apply for financial help weighed, while a weakening performance in Europe likely lay behind declines in building materials group Wolseley , which one of the worst performing blue chips.
The blue-chip FTSE 100 was down 0.2 percent, or 8.27 points lower, at 5,812.18 points.
Wolseley fell by around 1 percent after its profit rise came in slightly below a company-compiled consensus forecast.
Analysts at brokerage Jefferies added that the company's weakness in Europe, whose economies are bearing the brunt of the euro zone debt crisis, were a concern.
"With the outlook for Europe (especially the Nordics) continuing to be difficult, we expect limited consensus upgrades on the back of today's numbers," Jefferies' analysts wrote in a note, keeping a "hold" rating on Wolseley shares.
Equity markets around the world have rallied sharply since stimulus measures were taken by global central banks from July onwards to fight off the effects of the weakening global economy.
Yet despite a pledge by the European Central Bank to restart a bond-buying programme, many investors remain concerned by the euro zone's sovereign debt crisis, which has led to a bailout in Greece and is pushing Spain towards a similar move.
"The market wants to hear Spain come out and say 'we need money' before it can get a next leg up," said Hartmann Capital trader Basil Petrides.
Petrides said that if the FTSE 100 fell back below the 5,800 level - seen by technical traders as key to propelling further gains - it could go back down to around 5,725 points.
"I see the market going softer before it can go higher again," said Petrides.
Securequity sales trader Jawaid Afsar said any pull-back on the FTSE 100 could push it back down to levels of around 5,700 points - around where the 200 simple day moving average level of the index currently lies.
"I am still cautious. Uncertainty still persists in terms of what is happening in Europe," he said.
(Reporting by Sudip Kar-Gupta; Editing by John Stonestreet)
Keywords: MARKETS BRITAIN STOCKS/OPEN