The FTSE 100 was trading 0.2% lower at 6,811 in early morning trade, pulling back after a 1.7% surge the day before as investors reacted to comments from Russian President Vladimir Putin.

Speaking for the first time since the ousting of former Ukraine President Viktor Yanukovych last month, Putin said he saw no need yet to send troops into Ukraine after the situation had “dissipated” and he would only send soldiers into the country in an extreme case.

Nevertheless, tensions still remain high given the Western condemnation of recent actions by Moscow to step up its military presence in the Crimea region.

“We have not been short of countries condemning the position of Russia but no one has gone as far as to actually react with any meaningful talk of sanctions against Russia. However, sanctions could cause huge issues for not only Russia but for the rest of Europe and the world,” said James Hughes, Chief Market Analyst at Alpari.

Economic data in focus

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Overnight, Chinese Premier Li Keqiang set his gross domestic product (GDP) growth target for 2014 at 7.5%, the same as for 2013. The inflation target is 3.5%.

Also in China, the HSBC/Markit services purchasing managers’ index (PMI) rose to 51 in February, up from 50.7 in January, showing that activity growth had picked up last month.

A host of PMIs are also due out in the Eurozone today, along with fourth-quarter GDP revions for the region and retail sales data. Meanwhile, the UK services PMI is expected to ease to 58 in February, from 58.3 the month before.

Over in the States, markets will be paying close attention to the ADP employment report which is often seen as a rough indicator for the more closely-watched non-farm payrolls figure due out on Friday. ISM services data, mortgage applications and the Federal Reserve’s Beige Book will also be in focus.

Admiral gains, Melrose drops

Investors cheered an in-line set of full-year results from insurance giant Admiral, as the group hailed the “year of the baked potato” – what it described as a “comfort food” set of results. Group profit before tax was up 7% on turnover which was down 8%.

Industrial conglomerate Melrose saw profits almost double in 2013, helped by a full year’s contribution from Elster which was acquired in 2012, but shares dropped sharply early on. Numis downgraded its rating on the stock this morning from ‘hold’ to ‘reduce’, saying it sees “more downside risk
than upside potential on a shorter term basis”.

Legal & General also fell despite delivering record results for 2013 as profits grew 10%.

A number of heavyweights were trading lower after going ex-dividend this morning, including Ashmore, BHP Billiton, Hays, Kier, Oxford Instruments, Rio Tinto, Spirent Communications and TUI Travel.

FTSE 100 – Risers
Admiral Group (ADM) 1,487.00p +4.79%
Standard Chartered (STAN) 1,319.00p +3.49%
Randgold Resources Ltd. (RRS) 4,989.00p +2.21%
RSA Insurance Group (RSA) 97.75p +1.93%
Intertek Group (ITRK) 3,089.00p +1.51%
Severn Trent (SVT) 1,875.00p +1.35%
GKN (GKN) 406.80p +0.99%
International Consolidated Airlines Group SA (CDI) (IAG) 443.90p +0.91%
Whitbread (WTB) 4,437.00p +0.86%
Johnson Matthey (JMAT) 3,289.00p +0.80%

FTSE 100 – Fallers
Melrose Industries (MRO) 312.00p -4.85%
Meggitt (MGGT) 488.10p -3.63%
Persimmon (PSN) 1,430.00p -2.65%
TUI Travel (TT.) 440.00p -2.22%
CRH (CRH) 1,738.00p -2.19%
Legal & General Group (LGEN) 235.50p -2.08%
Rio Tinto (RIO) 3,311.50p -2.07%
BHP Billiton (BLT) 1,898.00p -1.50%
Experian (EXPN) 1,086.00p -1.45%
Ashtead Group (AHT) 946.00p -1.05%

Source: ShareCast