* FTSE 1O0 flat
* Banks lead European peers after news Deutsche cash raising
* Basel III bank reforms seen finalised Sunday, Monday
* Integrated oils main sector decliner; BP delays Q3 report
By Simon Jessop and Simon Falush
LONDON, 10 (Reuters) - Britain's leading stock index was flat early on Friday, hovering near a four-month closing high in cautious trade ahead of the weekend when European banking capital rules are set to be finalised.
At 0803 GMT, the blue-chip index was down 1.71 points at 5492.46, after its highest close since the end of April on Thursday, boosted by bullish U.S. jobs data.
Banking sector stocks were slightly lower, led by a 1.1 percent fall in Barclays, but state-backed Lloyds Banking Group and Royal Bank of Scotland were firmer.
Gains from defensive tobacco stocks cancelled out weakness from energy stocks.
"The bulls and bears have knocked each other senseless and are lying in the corner. The bulls are waiting for employment growth and the bears are waiting for European problems to blow up," John Haynes, head of research at Rensburg Sheppards, said.
After gains this week and last, technical analysts were pointing to significant resistance not far from current levels.
Nicole Elliott, technical analyst at Mizuho Corporate Bank said 5,514 was a key level. "A sort of neckline between topping activity in 1999/2000 and 2006/2007, separating that type of price action from the rallies and falls before and after them."
While news of a potential 9 billion euro ($11.4 billion) share sale by Deutsche Bank sent banking shares lower across Europe at the open, British lenders fared better, with analysts pointing to their stronger financial position relative to continental peers. Regulators meet this weekend to hammer out final rules for lender capital buffers, with talk of a 7 percent core Tier 1 ratio in the market.
David Buik, analyst at BGC Capital Partners, said in a note that British banks seemed to be in that position already.
Overnight in Asia, the U.S. data combined with strong China trade figures helped support markets, although indexes came off their highs ahead of the European open.
After Britain posted a record goods deficit on Thursday, investors will eye the release of producer prices data for August at 0830 GMT for further signs to the health of the economy.
Across Europe, French and Italian July industrial output and final Italian GDP data was also due. In the United States, July wholesale inventories data is due for release at 1400 GMT.
OILS LEAD DECLINERS
In a quiet news day for blue-chip stocks, integrated oil stocks led decliners on a sectoral basis, taking 3 points off the index.
BP led the sector lower with a fall of around 0.6 percent after saying it was to push back the release of third-quarter results due to the complexity of accounting for the cost of the Gulf of Mexico oil spill.
Elsewhere in the sector, BG Group also fell 0.6 percent.
Defensive tobacco stocks were in favour, with Imperial Tobacco leading the blue-chip gainers, up 1.7 percent.
3I Group was also a strong gainer, up 1.3 percent after a Financial Times report it was gearing up to exit its holding in Dutch pump-maker Hyva, valued at around 500 million euros ($634 million), at a large profit. (Editing by Dan Lalor)