The FTSE 100 index managed a modest recovery from Wednesday's losses but technology stocks suffered another difficult day.
Investors continued to be caught between fears of higher interest rates in the US and hopes that the rate cycle in the UK might have peaked.
Retail sales figures for April were unexpectedly weak, with a fall on the month of 0.3 per cent, compared with forecasts of a 0.4 per cent increase.
Part of the decline was attributed to the wet weather in April but the figures were seen as making it less likely that the Bank of England would raise interest rates at its June meeting.
That prompted the pound to weaken against the dollar, falling to another six year low of $1.4809 (€1.65). Tuesday's half percentage point rate move by the Federal Reserve took US rates above those prevailing in the UK.
Sterling's weakness is helpful for some sectors of the market. According to Ian Scott, European strategist at Lehman Brothers, "relative to bonds, the UK market is more attractively valued than most global markets and the recent fall in sterling against the dollar has had a beneficial impact. It is good news for dollar earners such as beverage stocks, pharmaceuticals and oils."
The FTSE 100 was in positive territory throughout the day but the gains were always modest. Wall Street had fallen sharply overnight and Tokyo had followed suit in the morning.
When New York opened yesterday, it did not give much of a lead to the UK, with the Dow Jones Industrial Average modestly up and the Nasdaq Composite modestly down by the London close.
Footise ended 36.7 up at 6,232.9, compared with its best of the day of 6,256.0. The oil majors BP and Shell were responsible for nearly all of the rise.
Sentiment towards technology stocks was not helped by the overnight collapse of the sportswear e-tailer boo.com.
Lastminute.com suffered another slide and tech stocks were prominent in the list of FTSE 100 losers. The Techmark 100 index of leading technology stocks fell 53.31 to 3,344.13.
Telecom stocks were also hit as the market reacted badly to the latest figures from British Telecommunications.
