ALEX McLEISH remained positive over Scotland's Euro 2008 qualification hopes despite defeat in Italy.

Big Eck had been hopeful of taking at least a point from a team who have endured a stuttering start to their own campaign, to keep Scotland out in front in Group B.

However, a double from Luca Toni secured a vital three points for the home nation in Bari and moved Roberto Donadoni's men to within two points of joint-leaders Ukraine, Scotland and France on 12 points.

But McLeish said: "We have to believe that we can still qualify and we need to go forward.

"The games at home will be very important for us. It would have been fantastic to take something from last night's game and it would have given us a really good chance.

"But we are still in sight with the other teams.

"To get six points from our next two games against the Faroe Islands and Lithuania would keep us in the running for qualification and mean we were still in with a very good chance."

He added: "We thought we could go there and get something last night.

"The players were really confident and they were entitled to feel confident because the atmosphere in the group was fantastic.

"We had to have the belief coming here and I thought the players had that.

"But it was the amount of free kicks we gave away which cost us and that is a lesson we have learned in European football.

"We lost a goal - Luca Toni's a big threat and excellent in the air, but we'll feel it's soft.

"A lot of the challenges from my players wouldn't have been free kicks in the British game.

"It was something we had spoken about, so it's something we have to be a little cuter about."

But McLeish had no criticism for his players.

"I think it was a decent performance. I've no complaints about the lads and their efforts this whole week.

"We got forward at times and had some near things, but not near enough.

"There were a lot of things satisfying for me - the performance of Scott Brown, for instance, and Shaun Maloney was bright when he came on.

"We just need that killer touch in front of goal."

McLeish admitted the result was about right, with Scotland having few chances while Italy could have had more goals.

"They deserved their victory but I can't fault my players' performance," he said.

Toni, Serie A's second-top scorer so far this season, proved to be a constant menace for Scotland.

And McLeish admits he was not surprised the Fiorentina striker proved to be the difference between the two nations on the night.

He said: "Of course we knew Toni was a very dangerous player. I saw him two years ago against Holland in Amsterdam and he had a fantastic game.

"He has the capability of scoring goals with his head because of his power in the air.

"When we lost the goal, the game was still open and we had to go forward and try to score a goal and that left gaps at the back.

"But you can't take anything away from Toni and his ability in the penalty box."