London: European shares fell in choppy trading early on Friday after hitting their highest level in nearly nine months in the previous session, with weaker energy stocks overshadowing positive miners and banks.
At 1:53pm, the FTSEurofirst 300 index of top European shares was down 0.2% at 929.08 points after closing 2.2% higher on Thursday.
But the index, which slumped 45% in 2008, has surged 44% since hitting a record low in March and is on track for the third successive week of gains. It is still down 43% from a peak in mid-2007.
Energy shares lost ground, with BP, Royal Dutch Shell, BG Group, Tullow Oil, Repsol and ENI shedding between 0.7% and 5.7%.
Total fell 2.9% after it posted a 54% fall in second-quarter net income, but foreign exchange gains helped the French oil major beat analysts’ expectations.
“The last trading session of the week may indicate how we sail next week; and at almost year highs, traders could be looking to take profits across the board,” said Owen Ireland, analyst at ODL Securities.
“The general mood, however, is one of sheer delight and positivity, so it wouldn’t be surprising to see markets catch the gale and push forwards and upwards with gusto.”
Across Europe, UK’s FTSE 100 index, Germany’s DAX index and France’s CAC 40 were all marginally lower.
Markets are waiting for US second-quarter GDP data due at 6:00pm, to give further direction.
Economists in a Reuters survey forecast a 1.5% annualised rate of contraction compared with 5.5% in the final first-quarter report.
Miners, banks advance
Mining shares were in demand, supported by firm metals prices. Copper rose 1.3%, zinc jumped 2% and aluminium rose 0.5%, BHP Billiton, Antofagasta, Rio Tinto and Xstrata rose 0.2-2.5%.
Miner Anglo American was up 0.1%. It said underlying earnings per share for the six months to the end of June fell to 91 cents, higher than a consensus forecast of 81 cents, from $2.90 a year ago.
Among financial shares, HSBC, Barclays, BNP Paribas and Societe Generale advanced 0.4-0.9 percent.
Shares in Air France-KLM fell 2.8% after the company posted wider-than-expected quarterly losses, hit by unprofitable fuel hedging contracts.
“The first-quarter operating loss was disappointing. But we believe that the extent of this loss could put management in a position of strength for negotiating with trade unions,” a trader said.
British Airways rose 4.2% after the company said it had cut operating costs by around 6.6 percent since last October as it fights to slim down during the downturn.
French building materials group Lafarge slipped 4.3% after it reported a 45% fall in second-quarter net income and cut its outlook for 2009 global cement sales as economic conditions deteriorated.
French tyre manufacturer Michelin was up 5.9% after it posted a smaller-than-expected first-half loss.