FTSE dips early as banks fall after Barclays results

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At 8:35 a.m., the FTSE 100 was down 32.5 points, or 0.55 percent at 5,914.1, after rallying 2.8 percent in the previous session.

The FTSEurofirst 300 index of top European shares were also weaker early in the session, with Credit Suisse down over 9 percent after it said it marked down the value of asset-backed investments by $2.85 billion, wiping $1 billion from its net income.

"The market is completely and totally hacked off with Credit Suisse coming out with those provisions, just two weeks after reporting their results," said David Buik of Cantor Index.

"It has brought all the doubting Thomases out, saying 'Hang on a minute, is it the end of the write-offs season? Or is there more to come?'"

Barclays shed 2.6 percent, after gaining 7.6 percent on Monday, after Britain's third biggest bank raised its 2007 write-down on the value of risky assets to 1.6 billion pounds but said profits came in broadly in line with analysts' expectations.

The bank raised its final dividend to 22.5 pence per share, lifting its full-year payout to 34 pence, up 10 percent from 2006 and just ahead of a Reuters Estimate average forecast of 33.7 pence.

Within the sector, Royal Bank of Scotland, HBOS, Lloyds TSB, HSBC, Standard Chartered and Alliance & Leicester fell between 0.5 and 2.7 percent.

Cadbury Schweppes lost 4.7 percent to top the losers' list on the FTSE 100 as analysts cited investor disappointment at the lack of capital returns in the planned demerger of its North American beverage business.

InterContinental Hotels, the world's largest hotelier, dipped 1.9 percent after it said the economic outlook for the industry was looking more uncertain as it met forecasts with an 18.5 percent rise in annual profit.

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