LONDON, Feb 3 - European shares slipped on Tuesday as investors digested a mixed batch of results from the likes of Sweden's Volvo, among others, and followed a scrappy performance on Wall Street as doubts about the economic recovery nagged. Disappointing numbers from the world's second-largest truck maker, Volvo , Swiss speciality chemicals firm Ciba and Danish bank Jyske Bank were partly offset by solid results from Dutch pharma and chemicals firm Azko Nobel and a successful placement in French IT firm Atos Origin . Insurers weighed after Merrill Lynch cut Germany's Allianz and Munich Re , and Britain's Royal & Sun Alliance , to sell. By 0921 GMT, the FTSE Eurotop 300 index <.FTEU3> was down 0.2 percent at 982.0 points while the narrower DJ Euro Stoxx 50 index <.STOXX50E> was steady at 2,852.7 points. Pan-European indexes have stalled in the past two weeks, having stormed to 17-month highs earlier this month on the back of a strong run in cyclical sectors like technology and media. However, some patchy economic data, the threat of a rise in U.S. interest rate and concerns valuations may be stretched on some stocks has encouraged some investors to book profits. Ben Funnell, a European strategist at Morgan Stanley, said a positive surprise on the strength of the global economy was on the cards after U.S. fourth-quarter GDP growth came in weaker than expected last week. "Our view is that China will still grow imports by at least 20 percent this year and the U.S. will be strong, and therefore earnings growth in Europe is probably still under-estimated." Morgan Stanley was still overweight in cyclical sectors, but expected the outperformance to wane in the coming quarter.
DOLLAR WEAKENS, SECURITY CONCERNS RISE
European auto stocks <.SXAP> fell as the dollar retreated one percent against the euro. The dollar fell against major currencies as the discovery of the poison ricin in a U.S. Senate office heightened concerns about possible attacks against the U.S., and on nervousness ahead of the meeting of G7 finance ministers later this week. In New York on Monday, the Dow Jones industrial average <.DJI> closed 0.1 percent firmer at 10,499.2 points, and the Nasdaq Composite <.IXIC> ended down 0.2 percent at 2,063.2 points. Both indexes were higher as European markets closed. Around Europe, London's FTSE 100 <.FTSE> remained stuck in its downtrend, dipping 0.4 percent. The FTSE has fallen for seven of the past nine sessions. Paris's CAC-40 <.FCHI> was flat, Zurich's SMI <.SSMI> was down 0.2 percent and Frankfurt's DAX <.GDAXI> was 0.3 percent weaker.
CIBA SUFFERS
Swiss speciality chemicals firm Ciba was 2.3 percent weaker after posting a worse-than-expected 55 percent fall in net profit as it suffered from weak demand and temporary plant shutdowns. Europe's biggest biotech company Serono was down 2.1 percent after reporting late on Monday that its quarterly net profit jumped 37 percent as sales were boosted by favourable exchange rates. Still in the sector, Dutch chemical and pharmaceutical group Akzo Nobel beat expectations with a 2003 net profit of 811 million euros but warned it expected 2004 net income to fall. Its shares rose 1.2 percent. Sweden's Volvo was 4.3 percent weaker after the company missed consensus forecasts for its fourth quarter and said it would spin off its stake in rival Scania to a new company if it failed to sell it. Danish bank Jyske Bank was down 3.9 percent after posting a lower-than-expected rise in 2003 core earnings, and saying it expected flat core earnings in 2004. Corporate activity was a feature as U.S. energy services firm Schlumberger cut its stake in Atos Origin through a private placement. Atos shares were two percent firmer. Also in France, banks were placing 35.2 million shares in broadcaster M6 on behalf of Suez . M6 shares, which fell sharply on Monday, were down 1.1 percent, while Suez shares were 0.8 percent weaker.//