FTSE weaker as investors stay cautious

Britain's top share index continued to trade lower on Tuesday morning as Italian and Spanish government bond yields rose, promoting investors to remain in risk-off mode as GDP numbers failed to inspire or depress.

London's blue-chip index was 0.8%, to 5,474.96 by 1031 GMT

The main cause for concern was Italian and Spanish bond yields, with Italy's 10-year bond edging closer to 7%, a level widely reported as being the point at which refinancing the country's debt becomes unsustainable.

Economic data was uppermost in traders minds, with figures from Eurostat showing the Eurozone GDP growth meeting expectations with 0.2% growth in the third quarter – matching growth in the second quarter.

Meanwhile, While France and Germany posted solid third quarter GDP growth at the top end of expectations.

In keeping with the ‘risk-off’ trade, mining and bank stocks led the FTSE100 lower, although the biggest laggard was Burberry which dropped more than 5% as investors took profits following strong first-half results from the luxury goods maker.

Smith & Nephew remained atop the leader-board following yesterday’s gains on the back of an upgrade from Exane BNP Paribas.

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