Man Group weighed down by declines in its benchmark fund

Shares in the hedge fund manager lost 3.7 per cent to 250p after the value of its benchmark fund slipped to its lowest in nearly a year.

Man's AHL fund, which analysts believe accounts for about three-quarters of group profit, lost 2.2 per cent last week. The trend-driven futures fund has dropped 14.3 per cent so far this year, and is nearly flat over the past 12 months.

Investors see AHL's performance as a barometer for performance fees and private client sales. A sales drive in the second quarter helped Man deliver stronger-than-expected interim results last month but that momentum may be petering out.

Analysts have also raised concerns about the American-led campaign to control commodity trading. AHL, which has about 30 per cent invested in commodities, tends to perform best in periods when the oil price spikes or drops sharply.

The FTSE 100 closed fractionally higher, adding 3.89 points to 4,689.67. Stocks trading without rights to dividends dragged on the index. Scottish & Southern Energy was marked down 5.1 per cent to £10.76 and SABMiller lost 1.9 per cent to £13.20.

Just 773m blue-chip shares changed hands through the LSE, against a daily average of 1bn. Still, it was a slight improvement on Tuesday's turnover, which was the lowest bar May Day since the turn of the year.

Among the gainers, Lloyds Banking Group added 2 per cent to 98¾p after saying it was reviewing a decision to close Cheltenham & Gloucester branches. The bank said in June it would shut the 164-branch network.

Lloyds was also helped by an upgrade to "buy" from RBS, which recommended clients focus on the prospects of a 2013 recovery and back any plans for a partial equity issue.

For Lloyds to avoid the government's asset protection scheme entirely did not seem credible as it would require a £20bn fundraising, RBS said. However, it saw some kind of hybrid issue as a potential positive for shareholders.

Better-than-expected interim results lifted ENRC to the top of the blue-chip risers. It gained 6.2 per cent to 825½p. The miner for the steel industry said it had benefited from Chinese restocking, and was confident that Russian demand would bounce back in the second half.

Security contractor G4S was up 1.9 per cent to 217¼p on hopes its first-half results on Monday will impress. UBS forecast the group to beat market expectations both on sales and profit margin thanks to its emerging market exposure.

Among the fallers, Shire lost 2.5 per cent to £10.11 after JPMorgan downgraded the drugmaker to "neutral" on valuation grounds.

Nomura turning cautious on the European building sector pushed Wolseley down 1.7 per cent to £13.85.

Wolseley is at a 55 per cent premium to its sector, even though its partial disposal of the Stock lumber business has reduced gearing to a US recovery, Nomura said. It cut the shares to "reduce".

British Land lost 2.4 per cent to 471½p as Société Générale and Evolution Securities both recommended investors take profits. SocGen also questioned whether the likely part-sale of British Land's Broadgate development would be enough for management to deliver on a commitment to start investing once markets turn. "Any major reinvestment would require a rights issue to maintain leverage at an acceptable level if prices were to fall again," the broker said.

Drax , the power station owner, led the mid-cap risers, up 4.5 per cent to 477½p, with the stock playing catch-up with energy futures. Goldman Sachs, though it kept a "neutral" rating, said the stock could rebound by 28 per cent based on current forward energy prices.

Bakery Greggs slipped 0.8 per cent to 396¾p after Oriel Securities started coverage with a "sell" rating.

"Increasing consumer confidence may actually be bad news," said Oriel. "The switch back into healthy eating and premium brands is already afoot and history tells us that Greggs' like-for-like sales tend to under-perform in an upturn."