European shares snap 6-day winning run; banks dip

* FTSEurofirst 300 falls 0.3 pct after 6 session of gains

* Banks among top decliners, sector index down 1 pct

* Intel results boost European technology stocks

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

By Atul Prakash

LONDON, July 14 (BestGrowthStock) – European shares dipped on
Wednesday after six straight sessions of gains, with financials
falling on expected tough new capital and risk rules for banks,
though a rise in tech stocks after Intel (INTC.O: ) results
limited losses.

At 1053 GMT, the FTSEurofirst 300 (.FTEU3: ) of top European
shares was down 0.3 percent at 1,042.01 points after trading in
a range of 1,040.84-1,049.97. The index hit a three-week closing
high in the previous session.

Financials were among the top decliners, with investors
keeping a close eye on a meeting of the Basel Committee of
banking supervisors and central bankers in Switzerland on
Wednesday and Thursday to start finalising its tough new bank
capital and liquidity rules. [ID:nLDE66C1DY]

Borrowing by Spanish banks from the European Central Bank
surged in June to a new record high, indicating tight access to
funding before the expiry of 442 billion euros in one-year ECB
loans at the start of July. [ID:nLDE66C1RA]

The STOXX Europe 600 banking index (.SX7P: ) fell 1 percent,
while HSBC (HSBA.L: ), Lloyds (LLOY.L: ) and BNP Paribas (BNPP.PA: )
were down 1.2 to 2.2 percent. Spain’s BBVA (BBVA.MC: ) lost 1.4
percent.

Top bankers said on Tuesday that the planned rules that will
force banks to top up their capital and curb risk to avert a
repeat of the financial crisis could choke growth and raise
costs for consumers.

“This whole issue about banks, and do they have sufficient
capital, is definitely something which will keep markets on
their toes. We will have volatile sideways trend,” said Klaus
Wiener, head of research at Generali Investments.

“Probably the market doesn’t have the strength to continue
to go higher after a streak of gains and now we have a period of
profit taking. The earnings season underpins the market, but
there is still concern about the macro environment.”

Technology stocks gained ground after Intel, the world’s top
micro-chip maker, reported second-quarter earnings that beat
analysts’ expectations, allaying fears that companies may be
slowing down their spending on technology. [ID:nN12197658]

Europe’s technology sector (.SX8P: ) advanced 1.2 percent,
with STMicroelectronics (STM.PA: ), Infineon (IFXGn.DE: ) and ARM
Holdings (ARM.L: ) gaining 1.8 to 3.7 percent.

ASML Holdings (ASML.AS: ) was the star performer, adding 5.7
percent after it raised its 2010 sales outlook as robust demand
for its chip-making machines drove better-than-expected
second-quarter results.

TECHNICAL RESISTANCE

Technical analysts saw significant resistance for the STOXX
Europe 50 (.STOXX50: ), which traded 0.3 percent lower at 2,478.17
points after rising up to 2,492.67 earlier in the session.

“The level to watch is 2,500 — the 200-day moving average,
with 2,486 being the 50-percent Fibonacci retracement from April
high to May low,” said Nicole Elliott, technical analyst at
Mizuho Corporate Bank.

She added that there was a lot of clustering around 2,513 —
the 38.2-percent Fibonacci retracement from a high in July 2007
to a low in March 2009.

Among individual movers, BP (BP.L: ) fell 1.4 percent. The oil
major said it delayed a critical test to determine if it can
close a cap on top of its ruptured well in the Gulf of Mexico.
[ID:nN13221621]

The stock is still up about 27 percent this month, though it
is down 38 percent since the leak started in April.

Across Europe, the FTSE 100 (.FTSE: ), Germany’s DAX (.GDAXI: )
and France’s CAC 40 (.FCHI: ) fell 0.1 to 0.6 percent. The Thomson
Reuters Peripheral Eurozone Countries Index (.TRXFLDPIPU: ) was
down 0.4 percent.
(Additional reporting by Simon Falush; Editing by Louise
Heavens)

European shares snap 6-day winning run; banks dip