By Helen Reid
LONDON (Reuters) - British blue chips suffered their worst day since the end of April on Thursday, but came off lows as pressure triggered by uncertainty over U.S. President Donald Trump's stimulus agenda eased.
The mostly foreign-earning FTSE 100 index (FTSE) ended down 0.9 percent, underperforming the broader European market as the pound strengthened after data showed consumers are maintaining spending despite inflation worries.
Global stocks recovered after Wall Street turned into positive territory, as strong economic data emboldened investors after a heavy sell off in the previous session.
Energy stocks were the biggest weight, taking 27 points off the FTSE, as oil prices fell on signs that the market remained well supplied with crude despite efforts by OPEC and other big exporters to curb production and support prices. [O/R]
Royal Dutch Shell (L:RDSa) was FTSE's biggest faller, down 3.9 percent, while BP (L:BP) fell 0.3 percent.
Construction stocks, which had been among the biggest beneficiaries of hopes surrounding Trump's promised infrastructure spending, were the biggest losers by mid-morning but they pared most of their losses as the mood improved.
Among them, equipment rental firm Ashtead (L:AHT) fell 1.1 percent and building materials firm CRH (L:CRH) ended flat.
Some investors said turmoil in the U.S. could spur further rotation from the American market into European and UK equities.
The world's biggest credit card data company Experian (L:EXPN) fell 2 percent after its full-year results showed slower growth in North America, while profitability and cash flow remained strong.
Hargreaves Lansdown (L:HRGV) rose 0.6 percent after a largely positive trading update saw assets jump 10 percent with increased market gains and inflows as more retail investors stashed savings into the new Lifetime ISA amid a global surge in equity markets.
Analysts at Liberum, however, maintained a 'sell' on the stock, saying rival Vanguard's aggressively priced platform launched in the UK on Tuesday signalled increasing pressures on Hargreaves' business model.
Luxury trench coat maker Burberry (L:BRBY) was a bright spot on the blue-chips, up 4.7 percent after its full-year results showing strong free cash flow rekindled investors' hopes for the stock.
Profits were down 21 percent when the currency impact is stripped out, hit by weaker demand in the U.S.
But analysts saw a better-than-expected cash flow, higher dividend and new share buy-back as positive signs for the company.
"Despite all the difficulties of the last few years, cash flow has held up throughout," said Steve Clayton, manager of the HL Select UK Shares fund.
M&A action brightened the picture on the mid-cap (FTMC) index. Laundry services group Berendsen (L:BRSN) surged 21 percent after it rejected French rival Elis's $2.6 billion (£2 billion) offer, saying it undervalued the firm significantly.
The French firm's latest approach was batted off as Berendsen said it did not see a basis for any further discussions with Elis.