A rebound in banking stocks failed to offset weakness in consumer stocks Diageo (DGE) and Primark owner Associated British Foods (ABF).
The FTSE 100 was flat at 7,422.
Inflation increased by 2.3% in February in 2017, up from 1.9% in January according to the Office for National Statistics. The main contributors were higher transport costs, especially fuel.
West Texas Intermediate and Brent crude oil slipped 0.8% higher to $48.58 and $52 per barrel, respectively.
Gold fell 0.5% to $1,227 per ounce and copper cheapened by nearly 1% to $5,798 per tonne.
The US stock markets Dow Jones and S&P 500 failed to rally on Monday as investors were negative on banks as the market questioned whether financial de-regulation would be passed.
Japan's Nikkei 225 closed 0.3% lower on Tuesday thanks to a weaker yen, while other markets in Asia shrugged off the underperformance and gained approximately 0.3%.
FTSE 100 RISERS AND FALLERS
Housebuilder Bellway (BWY) rose 2% to £28.84 on record first half earnings with volume growth supported by the Help to Buy scheme.
FTSE 250 RISERS AND FALLERS
Inhalation products business Vectura (VEC) was boosted by 4.5% to 164.5p as full year results unveiled a significant leap in royalty income.
SMALL CAP RISERS AND FALLERS
Investors took a stake in online gaming group 888 (888) on better-than-expected full year results. Management revealed strong organic sales and profit growth, as well as substantial free cash flow.
Energy products developer Flowgroup (FLOW) confirmed it selected a preferred bidder to buy Flow Energy and entered an exclusive agreement with this party. Investors were clearly excited about the potential sale as the stock soared 42% to 5.5p.
Soccer centres operator Goals (GOAL) reported profit growth, a positive trend in like-for-like sales and a good start to 2017, triggering a share price rise of 6.3%.
Ginger beer and tonic water seller Fevertree Drinks (FEVR) fizzled out despite good fantastic full year results. This included strong sales growth across all regions and new listings secured with Asda in the UK, Target in the US and Rewe in Germany. The absence of another round of upgrades encouraged some investors to take profits as the stock fell 3%.
Theme park ticketing specialist Accesso Technology (ACSO) revealed a 40% taxable profits surge to £10.1m on revenue up 10% to $102.5m.
Orogen Gold (ORE) announced it is proposing to dispose its mineral exploration interests and change the company business strategy. It said it will become a cash shell to complete a reverse takeover over the next six months. Management also raised £3m to explore corporate opportunities, but became the biggest small cap faller with a 34.8% drop in the stock.
Shares in oil producer EnQuest (ENQ) nudged higher after full year profits rose, despite a fall in revenues. Production rose by 8.7% to an average of 39,751 barrels of oil equivalent per day while operating costs fell to $24.6 per barrel compared with $29.7 in 2015. Investors welcomed the news that development of the Kraken field in the North Sea continued to remain on budget and on track for first oil in the second quarter.
Global payments platform Earthport (EPO) fell 10% to 23.6p despite half year results showing further strength in transaction numbers and payment volumes. Investors focused on continued losses and the news that break-even will be delayed due to additional investment in new growth initiatives.