After Tuesday's new year party in the markets, there was a calmer atmosphere yesterday.
After some to-ing and fro-ing, the FTSE 100 index added another 8.1 points to 6319.0 by the close, after its 90-point surge on Tuesday to a six-year high. But volumes were again light with 2.8bn shares changing hands.
Many dealers were surprised the London market was not higher, given that Wall Street was heading for a new closing record by the time the UK closed.
The US market, of course, was shut on Tuesday for Gerald Ford's funeral but made up for lost time yesterday. Better-than-expected US manufacturing figures and positive trading news from Wal-Mart helped fuel the increase, as did talk that the DIY group Home Depot could be a takeover target following the departure of its chairman and chief executive, Robert Nardelli.
Back in the UK, financial shares were stronger, as brokers came in with upbeat assessments of the banking sector. Northern Rock added 30p to £12.22, Barclays 14.5p to 760.5p and Royal Bank of Scotland 38p to £20.74.
"RBS remains the cheapest large bank anywhere," said analysts at UBS, which also suggested Bradford & Bingley, up 0.75p to 479.75p, was the most likely takeover target in the sector.
But mining stocks proved a drag on the index. It looks like last year's volatility in the sector is already being repeated, since the miners were among the leading risers on Tuesday and the biggest fallers yesterday.
Doing the damage was news that copper prices had fallen below $6,000 a tonne to their lowest level since April, with rising stocks prompting fears of excess supplies. Other base metals were also dragged lower, leaving mining shares making up eight of the top 10 fallers in the leading index. Xstrata was worst hit, down 152p to £24.17. Vedanta Resources fell 72p to £11.58p and Antofagasta was off 28p at 488p.
Drax, the energy group that operates Europe's biggest coal-fired power station, lost 43p to 761.5p on concerns about lower power prices and a mild - so far - winter. British Energy was 17.25p lower at 508p for similar reasons.
Oil prices fell more than $2 to below $58 a barrel as demand for fuel in the US slipped with better-than-usual weather. BP slid 2.5p to 569.5p, while Royal Dutch Shell dropped 6p to £18.07.
Also on the way down was CSR, the technology group specialising in Bluetooth products. The company has been named in a patent infringement case brought against Nokia, Samsung Electronics and Panasonic by the University of Washington. It issued a statement saying the suit was without merit, and it would defend its products vigorously.
CSR was also hit by a sell recommendation from analysts at Oriel Securities, and fell 19p to 640p, a near 3% decline.
Going the other way was hotel group Millennium & Copthorne, up 20.5p to 633.5p on continuing bid speculation, with traders talking of a 800p-850p offer.
Investors shrugged off a sell note issued by Panmure Gordon on Trinity Mirror and pushed the company's shares 10p higher to 480p. Panmure cut its price target from 500p to 430p and said there was little reason to stop the company's shares underperforming in the coming months.
Among the retailers awaiting Christmas trading news DSG International - formerly Dixons - added 1p to 196.5p on talk the electricals group had enjoyed a decent festive trading season and Next was 5p better at £18.47 ahead of an update due today. Jacques Vert climbed 1.5p to 22p on talk it too had done well over Christmas.
Lower down the market, inspection and testing company Intertek slipped 2p to 855p despite a positive note from house broker Bridgewell. This week's $311m (£158.5m) purchase of testing group Moody International by Investcorp highlights the potential value of Intertek, according to Bridgewell.
South China Resources added 2.75p to 11.75p with more than 13m shares changing hands, about 10 times the normal amount. Traders said one potential buyer had been waiting for the right time to acquire stock. The company recently announced a joint-venture copper project in Tibet, which it said would have a "significant impact on its business" and promised a more detailed announcement shortly.
SR Pharma added 1.5p to 58.25p. The biotech company has been granted a patent by the European Patent Office on its drug compounds based on RNA interference, a process involving "silencing" genes, and is seen as having the potential to produce treatments for diseases such as cancer and Aids.
Elsewhere diagnostic testing group BBI was unchanged at 144p as Legal & General edged up its stake from 11.96% to 12.15%, while Dragon Oil edged up 1p to 172p after an upbeat drilling report.
Vyke Communications, which specialises in internet phone services, was steady at 1.5p after it signed a distribution agreement with the Carphone Warehouse subsidiary Opal Telecom. But insurance broking group Broker Network added 10.5p to 254.5p on talk that current trading was 15% ahead of budget.
Wind in the sales
Keep an eye on IT and recruitment group Lorien, down 0.5p to 42p yesterday. Southwind, the investment vehicle of entrepreneur Bob Morton, has increased its stake in the company to 40.3% by buying shares at 40p each. According to the takeover code, Southwind now has to make an offer to Lorien's remaining shareholders to buy them out at 40p a share in cash. But Southwind has said it is only making the offer because it is mandatory to do so, and Lorien's board yesterday advised shareholders to take no action. Even if Mr Morton does not buy up all the remaining shares and stays as a 40% or so holder - which is clearly the intent - he will still have a major say in the future of the business. Traders believe there could be some exciting plans in the pipeline.