THE stock market faded towards a disappointing close yesterday after a promising start to the fourth quarter, finally closing marginally lower on balance, as measured by the FTSE-100 index.

Earlier, the market had shrugged off another dive by Wall Street on Friday and appeared set for a steady day in positive territory.

There were high hopes that this week's interest rate decision by the Bank of England's Monetary Policy Committee would see base rate remain at 6%.

Latest figures from the

Chartered Institute of Purchasing and Supply pointed to no increase in inflation, despite

the high price of oil and the fuel shortages of last month.

The firmer trend in shares was supported in the afternoon by modest early gains on Wall Street.

But it was not to last in

London, as sellers appeared shortly before the close and the earlier gains were lost. The

market had a mixed feel at the finish after a light trading day.

Technology issues were generally ahead, ignoring Nasdaq's volatility last week, though there were exceptions such as Misys which lost 2.5p to 632.5p.

Other software houses such as Logica and CMG were ahead. The former rose 112.5p to #23.35 and the latter 106p to 1415p.

Telecoms were firmer overall, with Telewest responding to renewed talk of a bid from NTL, though the shares closed off the top at 134.25p, up 2.5p.

BT was 15.5p to the good at 726.5p. The group denied reports that chairman Sir Iain Vallance was to step down early.

Media had a casualty in Emap which tumbled 40p to 869p, though Reed was 18.5p up at 555.5p.

There was a conflicting reaction to the split in National Power, which became International Power and Innogy, the latter taking in the UK activities. Its shares were unwanted as it dropped out of the FTSE-100, moving from a 175p opening to 166.5p. International Power on the other hand was chased, with the shares moving from 282p to 316p before ending at 311p.

Pharmaceuticals were easier, while biotechs featured further selling of Scotia, following the rejection of its main product Foscan by the US regulators. They lost 2p to 19.5p. They have now lost 83% of their value

following the shock US decision. Also in the same sector, Shire gained 53p to 1220p following a broker's comment

that recent selling had been

overdone.

Food retailers showed little reaction to reports that the forthcoming probe by the Competition Commission will force companies to sell off individual stores where it is thought local competition is insufficient.

Tesco, possibly the most potentially affected, slipped 4.5p to 244p, while Sainsbury was off a quarter of a penny at 372.25p.

Few companies reported results but lower profits from Manchester United caused the shares to lose 8.75p at 267.25p, even though most analysts think its long-term future is bright.

Another company to report, Moss Bros, saw its shares slashed 5p to 26p after it plunged deep into the red.

Several old economy stocks were unwanted, notably ICI, which fell 20p to 365p, and GKN, 12p off at 662.5p.