Last checked at 
LONDON (Alliance News) - UK shares are trading mixed mid-morning Tuesday following the report that Chinese inflation has slowed to a five-year low and amid continuing concerns about a potential Greek exit from the eurozone.
The FTSE 100 is down 0.5% at 6,806.57. The FTSE 250 trades up 0.2% at 16,613.07, and the AIM All-Share trades slightly lower at 699.16.
European stocks are outperforming London, with the CAC 40 in Paris up 0.3%, and the DAX 30 in Frankfurt up 0.1%.
Chinese inflation slowed to a five-year low in January on easing food inflation, with analysts saying this gives space for the central bank to adjust monetary policy to support weakening economic growth. Inflation eased by more than expected to 0.8% in January from 1.5% in December, the National Bureau of Statistics said Tuesday. This was the lowest rate of consumer inflation since November 2009.
Producer prices slid 4.3% year-on-year following a 3.3% drop a month ago. The rate of decline exceeded the 3.8% drop expected by economists and marked the biggest fall since late 2009. On a monthly basis, producer prices were down 1.1% in January.
Investors also are wary of the meeting between Greek Prime Minister Alexis Tsipras and other European leaders on Wednesday to negotiate the terms of Greek bailout package.
"Greece and the European Central Bank are still at loggerheads and the prospect of a Greek exit seems all the more likely. Greece is holding the rest of the eurozone to ransom as it awaits significant debt relief," says IG market analyst David Madden. "Traders are not taking any chances and financial stocks are suffering the most as the fear of a full-blown crisis is too much to bear."
Barclays, down 1.7%, and HSBC Holdings, down 1.5% are amongst the biggest FTSE 100 fallers.
Tesco and Wm Morrison Supermarkets performed the best out of the three London-listed supermarkets in the latest industry data from Kantar Worldpanel. The two supermarkets both managed to stem market share loss and falling sales, delivering their best performance in over a year, while J Sainsbury and Asda lost more ground.
The big four grocers - Tesco, Wal-Mart Stores Inc-owned Asda, Sainsbury's and Morrisons - again saw a decline in their share of the UK grocery market over the 12 weeks to February 1, when compared to a year earlier, the Kanatar data showed. However, Tesco's sales in the 12 week period actually rose by 0.3% year-on-year, having returned to growth for the first time since January last year, although it continues to lose market share, down to 29.0% from 29.2% a year ago.
In a tough grocery market, another good performance among the big four supermarkets was from Morrisons, whose sales fell by only 0.4%, its best performance December 2013. Its market share dipped to 11.1% from 11.3% a year earlier. Sales at Sainsbury's fell by 1.0% over the 12 weeks, while its market share fell to 16.7% from 17.1% a year ago. Asda's share fell to 16.9% from 17.3%, as sales fell the most out of the 'Big Four', by 1.7%.
Morrison is the biggest riser in the FTSE 100, trading up 5.8%, and Tesco is up 2.2%. Sainsbury's, however, trades down 0.9%.
Babcock International Group, up 3.0%, is one of the best performing FTSE 100 stocks. The FTSE 100-listed support services company said the strong performance in the first half of its financial year has continued into the second and said it is confident on meeting full-year expectations, though it did warn it faces some impact from the oil and gas industry spending cuts resulting from the drop in the oil price.
Mondi, up 2.2% is also a strong blue-chip performer after it said it expects its underlying operating profit for 2014 to be higher than the year before and said it expects to book after-tax charges below what it booked last year. The FTSE 100-listed paper and packaging company said it expects its underlying operating profit for the year to December 31 to be higher than the EUR699 million posted in 2013, though it did not provide guidance on how much higher it expects it to be.
Royal Mail, down 4.3%, is the biggest faller in the FTSE 100 after it was downgraded to Neutral from Overweight by JP Morgan.
Ultra Electronics, up 1.8%, is a strong performer in the FTSE 250. The company said it has won a GBP18 million contract with the Ministry of Defence to supply sonobuoys for the Royal Navy's Merlin maritime patrol helicopter. A sonobuoy is a small expendable sonar system that is dropped from aircraft of ships for underwater acoustic research.
UK industrial production declined by more than expected in December, while the manufacturing sector maintained its growth, the Office for National Statistics said. Industrial output fell 0.2% from the prior month, after staying flat in November. It was expected to fall by 0.1%. Manufacturing output gained unexpectedly in December. Nonetheless, growth slowed to 0.1% from November's 0.8%. Economists had forecast a 0.1% fall in December.
Still ahead in the economic calendar, the National Institute of Economic and Social Research's UK GDP estimate and US wholesale inventories are both due at 1500 GMT.
Futures indicate Wall Street for a largely higher opening. The DJIA is pointed up 0.1%, the Nasdaq 100 is indicated up 0.2%, while the S&P 500 is shown slightly lower.
By Neil Thakrar; neilthakrar@alliancenews.com; @NeilThakrar1
Copyright 2015 Alliance News Limited. All Rights Reserved.
