The FTSE Small Caps index falls 0.1 percent, lagging small rises forthe junior-listed AIM index, the FTSE mid-caps and the bluechips, largely due to heavy falls in energy group Cape and minerTalvivaara.
Shares in Cape fall 9 percent as the British energy services firm warnsfull-year profits will be below expectations due to problems with a liquefiednatural gas contract in Qatar.
"We understand that under an old contract framework that pre-dates thecurrent management team Cape were unable to re-negotiate productivity rates forcomplex elements of the installation contract," analysts at Numis say in a note,cutting their rating on the stock to "hold" from "buy".
"As such, management have taken the prudent view of recognising a provisionfor the contract."
Shares in Talvivaara fall 42 percent as the loss-making Finnish miner saysit will file for a court-supervised overhaul of the group, warning it otherwiserisked bankruptcy.
Reuters messaging rm://francesco.canepa.thomsonreuters.com@reuters.net