A return to growth in the beleaguered eurozone failed to give the London market a lasting boost yesterday as traders fretted over the Bank of England's commitment to low interest rates.
Stronger growth in Germany and France provided initial impetus, while the single currency bloc grew by 0.3% overall in the second quarter of the year, ending its six-quarter recession.
But the feelgood factor was short-lived as the FTSE 100 Index closed down 24.5 points at 6587.4, shaken by cracks in the Bank's radical new strategy to tie interest rate rises to unemployment.
Minutes of a monetary policy meeting showed divisions over how the policy should work, with one dissenter voting against new governor Mark Carney's plan.
Vicky Redwood, chief UK economist at Capital Economics, said the minutes will "hardly help to reassure the markets about the strength of the MPC's commitment to keep interest rates low".
Fears that the US Federal Reserve will soon start scaling back its monetary stimulus programme also returned to curb investor enthusiasm. This was fuelled by the country's latest retail sales figures, with core sales at their highest level in seven months.