FTSE weaker on talk of Fed stimulus cut

The UK mining index fell 0.3% to top the sectoral decliners' list, after copper prices slid about 1% on concerns about rising global supply. Nickel prices were down 0.4%.

In early trading, the blue-chip FTSE 100 index was down just 0.01%, following a loss of 0.4% in the previous session.

The UK banking index, sensitive to any suggestion the Fed may after all move ahead with its shift toward tighter dollar liquidity, fell as much as 0.3% before recovering.

St. Louis Federal Reserve Bank President James Bullard said on Friday a cut in the Fed's $85 bln monthly bond purchase beginning in October was possible. However, he later said low inflation meant the Fed can be patient in deciding when to scale back its pace of asset purchases.

"Bullard's comments last week leaves tapering on the agenda for the Fed, although a couple of weak housing market reports in the U.S. could dissipate that fear," Gerard Lane, equity strategist at Shore Capital, said.

Some British shares reacted to broker comments, with chemicals maker Croda International rising 1% after Credit Suisse raised its stance on the stock to "outperform" from "neutral".

However, National Grid fell 1.3% after UBS cut its recommendation for the stock to "neutral" from "buy".

Aberdeen Asset Management rose 2%, the best performer on the FTSE 100, after the company said underlying pre-tax profit for the year to September 30 was expected to be towards the upper end of market forecasts.

"Investors may take up defensive positions early this week aiming to shelter from moves lower in the riskier mining and financial shares," Tom Robertson, senior trader at Accendo Markets, said.