By This Is Money Reporters
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17.10 (close): A round of disappointing US data overshadowed some rare positive developments in the eurozone and held the London market back today.
The FTSE 100 Index pared gains and closed 9.6 points ahead at 5306.9 after US gross domestic product growth for the first quarter was downgraded to an annualised 1.9%, from 2.2%.
The Dow Jones Industrial Average was 0.4% lower at the time of the London close as the number of jobs created in May missed Wall Street expectations and compounded growth fears.
Euro crisis: Spain is struggling with soaring borrowing costs
Traders had been spurred on earlier by figures showing German unemployment falling to 6.7% from 6.8% in March, while inflation in the single currency bloc also dropped to 2.4% from 2.6% in April.
The European Commission also cheered investors as it said it was prepared to give Spain extra time to bring its budget deficit down if the Government produces a strong 2013 budget plan.
The pound continued to fall against the US dollar to 1.54 as the greenback was boosted by its perceived safe haven status. Sterling was slightly lower against the euro at 1.24.
The banking sector continued to come under pressure as sentiment altered throughout the day, with Lloyds Banking Group losing 0.1p at 25.4p and Barclays shedding 3.2p to 176.3p.
Heavily weighted mining stocks also fell out of favour, with Antofagasta dropping 15p to 1002p, Xstrata falling 16.9p to 922.5p and Anglo American slipping 12.5p to 1971p.
Broadcaster ITV plunged 6% amid fears that advertising markets will be weaker over the summer, with reports that some TV campaigns for July and August could be cancelled. Shares dropped 4.4p to 72.9p.
Elephant and Diamond owner Admiral was one of the biggest fallers in the top flight after the Office of Fair Trading said it planned to refer the "dysfunctional" car insurance market to the Competition Commission. Shares fell 80p to 1039p.
BQ owner Kingfisher was one of today's risers despite revealing a 12% fall in like-for-like sales at the DIY chain in the 13 weeks to April 28.
Chief executive Ian Cheshire blamed the extremely wet April in the UK and France, but said the company had been successful in protecting profitability. Shares were up 5.7p at 282p.
Outside the top flight, Halfords skidded 12% after the bicycle to car repair chain revealed a slide in profits and sales.
The group, which saw shares fall 34p to 241.9p, unveiled a 27% drop in annual profits and said sales had been "very disappointing" at the start of the new financial year.
IT services firm Logica, whose blue-chip clients include Shell, BT and BAE Systems, saw shares surge 70% after it backed a £1.7 billion takeover offer by a Canadian rival.
The former FTSE 100 Index company, which employs 5,500 of its 41,000 global workforce in the UK, is backing a bid by CGI in a move to build on its strength in Europe. Shares were 45.2p higher at 110.9p.
The biggest Footsie risers were Intercontinental Hotels up 88p at 1526p, Croda International ahead 83p at 2236p, Fresnillo up 41p at 1348p and Sage Group ahead 5.9p at 256.5p.
The biggest Footsie fallers were Admiral down 80p at 1039p, ITV off 4.4p at 72.0p, Evraz down 9.3p at 295.3p and Burberry off 42p at 1367p.
14.55: Wall Street has opened down after it emerged that the U.S. economy expanded less strongly in early 2012 than initially thought.
First quarter GDP growth in the world's largest economy was revised down to 1.9 per cent, from a first reading of 2.2 per cent.
The Dow Jones was 39.1 lower at 12,380.8 in early trading, while in London the FTSE 100 was 26.7 points higher at 5,324.
Spain's borrowing costs have eased to 6.42 per cent today but investors remain on hyper-alert for fresh signs of trouble.
Veteran commentator David Buik of BGC Partners said: 'The news was so dire from Spain yesterday â" no possibility at present of Spain being allowed to recapitalise its banks via a "rinky-dink" using the back door of the European Central Bank.
'Ten-year bond yields in Spain hit 6.7 per cent. Tax receipts have fallen 4.8 per cent in the last year and VAT by 14.6 per cent. So Spain has been whacked with a "double whammy" â" lower income and higher borrowing costs.
'The news from Greece was also grim with the Syriza socialists (anti-austerity) flip-flopping in the polls with the New Democracy party!'
David Jones, chief market strategist at IG Index, said: 'Today is one of those "calm after the storm" days, as everyone dusts themselves down and tries to work out their next moves.
'Nonetheless sentiment remains fragile, since Spain is still only a few basis points [in its government bond yield] away from a bailout.'
13.15:
The FTSE 100 is holding onto gains - it's up 39.9 points at 5,337.2 in lunchtime trading.
The top-tier index lost nearly 100 points yesterday on fears Spain was closer to taking an EU bailout as its borrowing costs soared and its banking sector tottered.
But heavily weighted mining stocks lifted the market today, with Fresnillo rising 21p to 1328p, Antofagasta lifting 9p to 1026p and Xstrata gaining 8.6p to 948p.
Lloyds Banking G roup was able to recover some of yesterday's losses, climbing 0.2p to 25.5p, but Barclays remained in the red, losing 0.4p at 179.1p.
Broadcaster ITV plunged 5 per cent amid fears that advertising markets will be weaker over the summer, with reports that some TV campaigns for July and August could be cancelled. Shares dropped 3.4p to 73.7p.
IT services firm Logica, which has a blue-chip clientele including Shell, BT and BAE Systems, saw shares surge 65 per cent after it backed a £1.7billion takeover offer by a Canadian rival.
The company, which employs 5,500 of its 41,000 global workforce in the UK, is backing a bid by CGI in a move to build on its strength in Europe. Shares were 42p higher at 108p.
9.40:
Markets have calmed after the turbulence of last session.
The FTSE 100 is up 43.6 points to 5,340.9, although with no sign of any imminent solution to Spain's bank problems investor mood remains tense.
Spain's 10-year borrowing costs remain at a still-elevated 6.55 per cent today, while Italy's interest rate is at 5.86 per cent.
Fawad Razaqzada, market strategist at GFT Markets, said: 'As yields on 10-year Spanish government debt head towards 7 per cent, and Italy not far behind, the odds are shortening that Spain will require a bailout.
'The worry is that the â¬700billion EFSF/ESM [bailout] fund just isn't big enough either to cope with Spain's dire situation, or to stem further contagion. As far as holders of Spanish bonds are concerned, the risk of being forced to take a haircut on their holdings is growing, hence the move higher in yields.'
Elephant and Diamond owner Admiral was one of the biggest fa llers in the top flight after the Office of Fair Trading said it planned to refer the 'dysfunctional' car insurance market to the Competition Commission.
Shares fell 30.5p to 1088.5p.
Read more about the car insurance probe here.
In other corporate news, Halfords fell nearly 7 per cent after it said recent sales had been 'very disappointing', including for its key market of cycles.
The retailer is hopeful of an improvement as the summer progresses, but with annual profits falling 27 per cent its shares were down 18p to 257.9p.
Kingfisher has also endured a difficult spring, with like-for-like sales in the UK and Ireland down by more than 10 per cent in the 13 weeks to April 28.
Chief executive Ian Cheshire blamed the extremely wet April in the UK and France but with the group working hard to limit the prof it impact shares were 1.75p higher at 278.05p.
8.40: The FTSE 100 has opened up 27.1 points at 5,324.4, but gains are likely to be limited by worries that Spain's bank crisis is spiralling out of control.
The blue chip index slumped 93.86 points or 1.7 per cent to 5,297.28 yesterday, reversing much of a previous four-session rally.
This puts it on course for a monthly drop of more than 7.5 per cent in May - the worst performance since August 2011.  Â
Wall Street, Asian shares and commodity prices retreated overnight and the euro currency dropped to its lowest in almost two years against the dollar, as a surge in Spain's borrowing costs fuelled worries it might not be able to fix its ailing banking sector and could need a bailout.  Â
Spain's 10-year interest rate hit six-month highs of over 6.7 per cent yesterday, flirting with the closely-watched 7 per cent level that is seen as unsustainable.
Investors' focus will also turn on Ireland today as it holds a vote on Europe's new fiscal treaty. Opinion polls point to a 'yes' vote that would save the eurozone extra trouble.
Brent crude dropped below $103 per barrel and prices were headed for their biggest monthly percentage drop in two years, as investors made a beeline for the exits due to the eurozone debt crisis.
British consumer confidence picked up in May, propelled by a marked easing of pessimism about the future, a survey by GfK NOP showed, pointing to some resilience in a major driver of the economy.
Businesses in Britain intend to increase their workforces in the coming year, although wage growth is likely to remain sluggish in what is emerging as a new long-term trend, the Confederation of British Industry said.
Nationwide's house price report for May will be released later, with a monthly increase of 0.2 per cent forecast after a 0.2 per cent fall in April. A year-on-year decline of 1.0 per cent is seen, after a 0.9 per cent drop the previous month.  Â
Stocks to watch today include:
Prudential: The insurer said it will buy SRL C America Holding Corp from Swiss Re for £398million in cash.      Â
Glencore, Xstrata: Commodities trader Glencore and miner Xstrata will send details of their long-awaited tie-up to shareholders, including a three-year retention package set to be worth tens of millions of dollars for Xstrata boss Mick Davis. Â Â Â
BHP Billiton: The global miner cleared the last external hurdle for a planned $10billion expansion of its Port Hedland harbour in Western Australia that would help the world's biggest miner double output of iron ore. Â Â Â Â Â Â
WM Morrison: Chief executive Dalton Philips said consumers are finding the economic environment so severe they are having to use savings to pay monthly bills, are skipping meals and are hiding treats from their children.
KINGFISHER will issue a trading update.   Â
TATE LYLE posts full-year results. Â Â Â
THOMAS COOK GROUP reports first-half results.   HALFORDS GROUP unveils full-year results.    Â
FULLER SMITH TURNER delivers full-year results.    Â
SCISYS issues an AGM trading update.   Â
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