European shares down at midday as banks weigh

* FTSEurofirst 300 down 0.5 pct; had hit 3-wk high early on

* Financials among top losers, Commerzbank down 6.2 percent

* Weaker crude, metal prices put pressure on commods

* For up-to-the-minute market news, click on [STXNEWS/EU]

By Atul Prakash

LONDON, Feb 23 (BestGrowthStock) – European shares were lower at
midday on Tuesday with investors trading cautiously after data
showed German business sentiment fell for the first time in
almost a year.
Banks bore the brunt, with Commerzbank (CBKG.DE: ) sliding 6.2
percent after saying it expected 2010 to be a difficult year
when posting a worse than expected fourth-quarter loss, hit by
weak trading results and loan loss provisions. [ID:nLDE61M06H]

The DJ STOXX banking index (.SX7P: ) fell 1.2 percent, while
BNP Paribas (BNPP.PA: ), Societe Generale (SOGN.PA: ), Credit
Agricole (CAGR.PA: ), Natixis (CNAT.PA: ), UBS (UBSN.VX: ), Credit
Suisse (CSGN.VX: ), Deutsche Bank (DBKGn.DE: ) and KBC Groep
(KBC.BR: ) were down 0.6-4.2 percent.

By 1217 GMT, the FTSEurofirst 300 (.FTEU3: ) index of top
European shares was 0.5 percent lower at 1,018.12 points, having
hit a three-week high at 1,029.80 early in the session. The
index is still up 57 percent since hitting a record low in March
last year.

“There is a little bit of uncertainty. The market is still
trying to make up its mind. This time the bears and the bulls
are more or less in equilibrium, but I think that the bears will
soon get the upper hand again,” said Philippe Gijsels, head of
research at BNP Paribas Fortis Global Markets in Brussels.

Investors awaited testimony from Federal Reserve chairman
Ben Bernanke on Wednesday and Thursday, which was expected to
shed light on how soon key U.S. interest rates may start to rise
after the surprise increase last week in the rate the Fed
charges banks for emergency loans. [ID:nN1983326]

“Bernanke will try to convince people that rate hikes are
not imminent, but the market is worried and the question is
whether the rates will remain low for an extended period of
time. Everybody knows that eventually liquidity will have to be
taken out of the system and rates have to go up,” Gijsels said.

Economic data also dampened spirits. The Munich-based Ifo
think tank said its business climate index, based on a monthly
survey of 7,000 firms, fell to 95.2 from 95.8 in January, below
a forecast for 96.1 (ECONDE: ).

Later in the session, investors will look at U.S. data,
including a consumer confidence reading and the S&P/Case-Shiller
index, which gives an indication of house price trends.

COMMODITY STOCKS SLIP

Commodity shares also lost ground as crude oil (CLc1: ) fell
more than 2 percent after a five-day rally, copper (MCU3: )
slipped 1 percent, nickel (MNI3: ) was down 0.7 percent and zinc
(MZN3: ) declined 0.8 percent.

Among energy stocks, BP (BP.L: ), Royal Dutch Shell (RDSa.L: ),
BG Group (BG.L: ), Tullow Oil (TLW.L: ), Repsol (REP.MC: ), Total
(TOTF.PA: ) and StatoilHydro (STL.OL: ) shed 0.1-1.7 percent.

Miners also dropped, with Anglo American (AAL.L: ),
Antofagasta (ANTO.L: ), Rio Tinto (RIO.L: ), Xstrata (XTA.L: ) and
Eurasian Natural Resources (ENRC.L: ) down 0.5-1.1 percent.

“The volatility we are seeing today looks to be a symptom of
nerves creeping in after the sharp gains seen over the last
couple of weeks,” said Anthony Grech, market analyst, IG Index.

Among individual movers, Carlsberg (CARLb.CO: ) rose 7 percent
after the Danish brewer upgraded medium-term profit margin
guidance. [ID:nLDE61M0EE]

Merck KGaA (MRCG.DE: ) fell 6.8 percent after the world’s
largest maker of chemicals for flat screens gave a cautious 2010
outlook that was below forecasts and cut its dividend,
reflecting uncertainty over its drugs pipeline. [ID:nLDE61I0N6]

Across Europe, Britain’s FTSE 100 index (.FTSE: ), Germany’s
DAX (.GDAXI: ) and France’s CAC 40 (.FCHI: ) fell 0.1-0.7 percent.

Stock Market Trading

(Editing by Dan Lalor)

European shares down at midday as banks weigh