European shares end lower on U.S. Fed caution

LONDON (BestGrowthStock) – European shares slipped on Wednesday on investor concern the U.S. Federal Reserve would inject less fresh stimulus than previously thought.

The pan-European FTSEurofirst 300 (.FTEU3: ) index of top shares provisionally closed down 0.5 percent at 1,087.99 points. The index has gained around 6 percent since the beginning of September on Fed action hopes.

“There is no certainty that the Fed will do what investors are looking for and no one is prepared to take big positions before the decision,” Jeremy Batstone-Carr, head of equities at Charles Stanley said.

“Investors are looking for $500 billion and a lot will ride on whether or not the Fed leaves the door open for more quantitative easing, if they don’t I think there is going to be an aggressive sell off.”

The banking sector which is sensitive to changes in the economic environment reversed earlier session gains, with the STOXX Europe 600 Banks (.SX7P: ) down 0.3 percent.

Looking at individual stocks, Norway’s Statoil (STL.OL: ) slipped 5.4 percent after it slashed its 2010 oil and gas production target.

(Reporting by Joanne Frearson)

European shares end lower on U.S. Fed caution