* FTSE 100 down 1.1 pct on investor caution
* Miners, financials drag index lower
* Energy producers, drug makers gain
By Farah Master
LONDON, March 25 (Reuters) - Britain's top share index fell
1.1 percent by midday on Wednesday as waning investor confidence
in a U.S. plan to remove toxic assets from banks weighed on
financials and miners, outstripping gains from defensive stocks.
At 1131 GMT the FTSE 100 index <> was 43.20 points
lower at 3,868.26 after closing down 1.1 percent on Tuesday and
snapping a three-day winning streak. The blue chip index is down
12.3 percent this year but still remains around 13 percent
higher than its low hit on March 9.
Miners dragged down the index, tracking a decline in base
metal prices, with Anglo American <AAL.L>, Xstrata <XTA.L>, BHP
Billiton <BLT.L> and Eurasian Natural Resources <ENRC.L> down
between 2.4 percent and 5.6 percent.
Rio Tinto <RIO.L> fell 2.5 percent, also hurt by a downgrade
to "sell" from "hold" from RBS. The Australian competition
watchdog cleared Rio Tinto's $19.5 billion tie-up with China's
state owned Chinalco. []
"We are a little bit undecided and there is a lot of
uncertainty going out today. Everyone is still looking at the
bad bank and bailout talk we have been hearing over the past few
days," said James Hughes, market analyst at CMC Markets in
London.
Financials were other standout losers despite U.S. President
Barack Obama assuring Americans his team's effort to revive the
U.S. economy was starting to work. []
HSBC <HSBA.L>, Royal Bank of Scotland <RBS.L>, Barclays
<BARC.L> and Standard Chartered <STAN.L> lost between 0.5
percent and 5.6 percent, while shares in Lloyds <LLOY.L> rose
0.7 percent.
Life insurers also fell, with Legal and General Group
<LGEN.L> down 5.6 percent after it halved its full-year
dividend. Prudential <PRU.L> and Friends Provident <FP.L> were
0.4-2.1 percent lower while Aviva <AV.L> fell 12.1 percent after
going ex-dividend.
British technology company Smiths Group Plc <SMIN.L>, the
biggest loser on the index, fell 13.5 percent after it said
underlying pretax profit fell 17 percent. []
CRUDE HOPES
Energy utilities added the most points to the index with
National Grid <NG.L> up 2.5 percent.
Oil majors were mixed, with BP <BP.L> and BG Group <BG.L>
down but Royal Dutch Shell <RDSa.L> up 0.6 percent.
"I don't think we can look past commodities at the moment,
they really are a key driver. With crude, if we drop through $50
again we could see the end of this rally for stocks," Hughes of
CMC Markets said.
Premier Oil <PMO.L> rose 8.9 percent after it agreed to buy
the North Sea unit of Canada's troubled Oilexco <OIL.TO>
[].
Drug companies gained with GlaxoSmithKline <GSK.L> up 1
percent after the world's second-largest drug maker promised to
make findings of its clinical trials public after being accused
of hiding sensitive information about its medicines, the
Financial Times said.
Peer AstraZeneca <AZN.L> rose 0.7 percent.
British retail sales fell more sharply than expected in
March and stores are just as gloomy about their prospects for
the coming month, a survey showed. []
(Editing by Hans Peters)
