By Alistair Smout
LONDON (Reuters) - The FTSE 100 consolidated near an eight-month high on Tuesday as reassuring news about economic conditions in emerging markets boosted consumer staples and financials, although miners weakened.
The FTSE 100 touched its highest since May 2013, before pulling back in the afternoon, with traders citing caution on Wall Street as U.S. markets reopened after a long weekend.
Banks lent support to the index, led up by Standard Chartered, which rose 2.3 percent to add over 2 points to the FTSE 100.
The Asia-focused lender gained after China's central bank moved to head off another destabilising liquidity squeeze on Tuesday with a big injection of cash.
"We are relative optimists on China," said Alan Higgins, UK chief investment officer at Coutts. "Despite the issues there, we think that China has the resources to cope with these issues, and they look like they're beginning to take some fundamental action also."
Improvement in emerging markets also helped consumer goods firm Unilever, which rose 1.8 percent after it unveiled better-than-expected 2013 results. Its earnings were helped by a rebound in emerging markets after weakness there fuelled a third-quarter miss.
Brewer SABMiller slipped 0.3 percent after announcing poor sales, however, saying it has been plagued by weak consumer sentiment in Europe.
"What's common across the consumer products area is that Europe and the euro zone are in difficulty ... Unilever really received its push ahead from emerging markets, because the growth in Europe has been sluggish," IG market analyst David Madden said.
"That's been evident in SABMiller also. It's not surprising that companies are looking to emerging markets to get their growth, because well-established markets in Europe are stagnant."
The FTSE was flat in percentage terms at 6,834.26 points at the close. Strength in consumer staples and banks was counteracted by weakness in miners, with traders saying the sector was set for a pause after posting its best week in 18 months last week.
The index remained just 0.6 percent off May's intraday high at 6,875, which was its highest level since December 1999.
Among the top individual risers was Intertek, up 3.2 percent, after fellow testing firm SGS hiked its dividend and revenue forecasts, adding it would continue to looking for growth opportunities in emerging markets.
(Editing by Larry King)