* FTSE 100 down 5.5 pct on week; five-session losing streak
* Domestic banks fall; HSBC up after results
* Lack of outright winner in UK elections weighs
By David Brett
LONDON, May 7 (Reuters) - Britain's top shares slipped back
in volatile trade at midday on Friday as uncertainty over euro
zone debt contagion and the lack of an outright winner in UK
parliamentary elections weighed on stocks.
By 1111 GMT, the FTSE 100 <> was down 5.81 points, or
0.1 percent at 5,255.18, with domestic banks among the hardest
hit. The index is set for a fifth straight day of declines and
its lowest close since Feb. 16.
"Where there's fear and uncertainty markets get damned.
There is a tendency for investors to get carried away. That is
what makes markets the beautiful instruments they are," said
Howard Wheeldon, strategist at BGC Partners.
UK-focused banks were sharp fallers on the FTSE 100, with
Royal Bank of Scotland <RBS.L>, Barclays <BARC.L> and Lloyds
Banking Group <LLOY.L> falling 2.3 to 3.6 percent.
But the sector was pulled higher by HSBC <HSBA.L>, up 4.1
percent after an upbeat first-quarter trading update.
[]
Asia-focused peer Standard Chartered <STAN.L> climbed 2.1
percent.
UK blue chips fell as much as 1.9 percent to 5,160.57 early
on Friday before rallying after Liberal Democrat leader Nick
Clegg said he believed the larger opposition Conservative party
should try to form the next British government after an
inconclusive election. []
It will be the first time no party has had an overall
majority in Britain's parliament in over 35 years, potentially
hampering the new government's ability to tackle the country's
huge deficit.
Outsourcing firm Capita <CPI.L> was the top FTSE 100 faller,
down 5.3 percent on concerns over the impact a stalemate might
have on future contracts, with Shore Capital downgrading its
rating. Peer Serco <SRCO.L> fell 3.1 percent.
WALL STREET AWAITED
U.S. stock futures pointed to a slightly firmer start for
Wall Street on Friday, recovering after a plunge overnight which
saw the Dow <DJI.L> fall as much as 9 percent at one point in
the session before recovering to a 3.2 percent fall as technical
trading glitches and Europe's debt crisis knocked sentiment.
Investors will focus on April U.S. non-farm payrolls, due at
1230 GMT, which are forecast to have risen by 200,000, after a
162,000 increase in March, with the unemployment rate seen
steady at 9.7 percent.
"The U.S. economy is improving. At the moment any worsening
will be seen by markets much more worryingly than they might
have done a month ago," said BGC's Wheeldon.
Gains in the mining sector <.FTNMX1770>, which had lost more
than 9 percent in the past week, helped prop up the blue chips
as some bullish punters went in search of bargains.
Rio Tinto <RIO.L>, BHP Billiton <BLT.L>, Vedanta Resources
<VED.L>, Xstrata <XTA.L> and Anglo American <AAL.L> added 1.5 to
4.9 percent.
(Editing by Jon Loades-Carter)
