European shares slip; oil majors, miners fall

* FTSEurofirst 300 down 0.3 pct

* Oil majors fall as crude dips after rise in inventories

* Miners sag; BHP drops after going hostile in Potash bid

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

By Harpreet Bhal

LONDON, Aug 18 (BestGrowthStock) – European shares slipped by midday
on Wednesday, falling from a one-week high hit a day earlier and
holding below a key resistance level, with oil majors pressured
as crude prices dipped on an increase in U.S. inventories.

By 1100 GMT, the FTSEurofirst 300 (.FTEU3: ) index of top
European shares was down 0.3 percent at 1,052.97 points, while
the Euro STOXX 50 (.STOXX50E: ) was down 0.4 percent at 2,727.01
points, retreating from the 50 percent Fibonacci retracement of
a drop from an April high to a May low tested on Tuesday.

Oil majors were among the biggest sector drags, as crude
prices (CLc1: ) slipped after a report showed a sharp drop in
petroleum inventories in the United States.

Royal Dutch Shell (RDSa.L: ), Total (TOTF.PA: ) and Eni (ENI.MI: )
shed 0.8 to 0.9 percent.

BP (BP.L: ) shed 1.3 percent. After hitting a bottom in late
June, the stock strongly recovered as the company made progress
in plugging the leaking well in the Gulf of Mexico, but it has
been retreating over the past two weeks on mounting concerns
over legal risks related to the clean-up of the leak.

Volumes on the FTSEurofirst 300 were slim due to the holiday
period, at just 20.1 percent of the average 90-day trading
volume by midday.

“Many people simply don’t trust the market because of the
absence of investors,” said Heino Ruland, strategist at Ruland
Research in Frankfurt.

“Investors don’t believe that the market is going to make a
new high this year… because of the fear of a double dip in the
United States and people are very cautious.”

Across Europe, Britain’s FTSE 100 index (.FTSE: ), Germany’s
DAX index (.GDAXI: ) and France’s CAC 40 (.FCHI: ) lost 0.1 to 0.6


Among individual stocks, Vestas Wind (VWS.CO: ) slumped 20.4
percent after the world’s biggest wind turbine maker posted a
surprise second-quarter loss and cut its 2010 earnings outlook.

However, fellow Danish company Danske Bank (DANSKE.CO: ) rose
3.4 percent after BofA Merrill Lynch upgraded its recommendation
on the Nordic bank to “buy” from “neutral”.

Other gainers included Legal & General (LGEN.L: ), which rose
3.1 percent as traders cited market talk of bid interest from
Zurich Financial (ZURN.VX: ). [ID:nLDE67H0XV]

Mining stocks also lost ground on Wednesday, trimming strong
gains made over the past four sessions. Kazakmys (KAZ.L: ),
Vedanta Resources (VED.L: ) and Rio Tinto (RIO.L: ) lost 0.7 to 1.1

BHP Billiton (BLT.L: ) shed 1.5 percent. The global miner went
hostile on Wednesday with its $38.6 billion takeover bid for
Canadian fertiliser group Potash Corp (POT.TO: ).

But the massive bid unveiled on Tuesday — coming in the
wake of Sanofi-Aventis’s (SASY.PA: ) $20 billion offer for U.S
biotech firm Genzyme (GENZ.O: ) — has raised hopes that a wave of
M&A deals could revive investors’ appetite for equities and lift
stock indexes out of the summer doldrums.

“Many market pundits had been looking for the next
catalysts, perhaps this move from BHP will be the trigger for a
raft of M&A activity over the remainder of the year,” Ben
Potter, analyst at IG Markets, wrote in a note.
(Additional reporting by Blaise Robinson in Paris; Editing by
Jon Loades-Carter)

European shares slip; oil majors, miners fall