European shares retreat, charts signal more weakness
LONDON, July 2
LONDON, July 2 (Reuters) - European equities drifted lower in thin volumes on Tuesday, led by Fresenius Medical Care , and failure to hold above an important technical level opened the door to further index weakness in the near term.
Slightly stronger than expected U.S. factory orders added to the jittery mood, with investors welcoming signs of improvement in the world's biggest economy but concerned that this could lead to a scaling back of the central bank stimulus that has driven the past year's rally in global equities.
The pan-European FTSEurofirst 300 closed down 0.5 percent at 1,157.94 points. The Euro STOXX 50 fell 0.8 percent to 2,602.51 points after failing to conclusively break above the 200-day moving average in the previous session.
"Markets are nervous, and I see the deterioration in some of the single names, we don't have any stocks supporting the up-movement and that makes the risk reward point a little lower," said Petra Kerssenbrock, technical analyst at Commerzbank Corporates and Markets.
"The short-term support is in the area around 2,588 points and we could fall below this level again."
Fresenius Medical Care led the fallers on the FTSEurofirst 300, down 8.8 percent in volume nearly six times its 90-day daily average after a proposal in the United States to cut government reimbursements to kidney dialysis centres there. (Reporting By Toni Vorobyova; editing by Simon Jessop; editing by Simon Jessop)