European shares fall again on U.S. economic woes
PARIS, Jan 17 (Reuters) - European stocks ended lower on Thursday, falling for the sixth time in seven sessions as weak U.S. factory data added to recession fears, while a massive quarterly loss at Merrill Lynch MER.N fuelled worries over banks.
But dovish comments from the U.S. Federal Reserve Chairman Ben Bernanke and a drop in U.S. weekly jobless claims helped cushion the fall.
Energy and mining shares were among the top losers, dragged lower by economic worries and mixed commodity prices.
Both Anglo American (AAL.L) and BHP Billiton (BLT.L) ended down 4.1 percent, while Total (TOTF.PA) fell 1.9 percent and Royal Dutch Shell (RDSa.L) shed 2 percent.
Drugmaker Novartis (NOVN.VX) sank 3.4 percent after saying its quarterly profit plummeted 42 percent, falling far short of forecasts.
The FTSEurofirst 300 .FTEU3 index of top European shares closed 0.6 percent lower at 1,374.36 points. Europe's benchmark index has already lost 8.8 percent since the start of 2008, hit by fears that the U.S. economy may tip into recession.
"We're at a time when the market is very focused on all the negative data and is really not paying attention to the bright spots," said Kate Warne, strategist at Edward Jones, in St. Louis in the United States.
"We will continue to see worries about the health of the U.S. economy, but it may not be in as bad a shape as some people think."
On the upside, Scottish & Newcastle SCTN.L jumped 5.4 percent after rival brewers Carlsberg (CARLb.CO) and partner Heineken (HEIN.AS) raised their takeover bid for S&N to 800 pence per share from the previous 780 pence, while S&N, which previously refused to discuss the consortium's approach, entered talks with the two firms.
Carlsberg dropped 4.7 percent and Heineken gained 1.8 percent.
Banks retreated, with the DJ Stoxx European index .SPX7 losing 0.5 percent, falling after U.S. investment bank Merrill Lynch posted a quarterly loss of nearly $10 billion after mortgage-related write-downs and adjustments totalling about $16 billion, sending its shares down 8 percent by midday on Wall Street.
UBS (UBSN.VX) lost 2.7 percent, Societe Generale (SOGN.PA) shed 2 percent and Commerzbank CBKGn.DE fell 3.6 percent.
"We're seeing mounting fears on how long the problems in the credit market will last and how bad it will get, and although some economic data such as today's factory data continue to show that the economy is weakening, there has been some better news on the jobs front," Warne said.
Data showed factory activity in the U.S. Mid-Atlantic region contracted dramatically in January, fuelling concerns over the prospect of a U.S. economic downturn. The weaker-than-expected numbers eclipsed earlier data that showed the number of workers filing initial claims for U.S. unemployment benefits fell unexpectedly last week, figures that reassured investors over the health of the labour market.
Around Europe, Germany's DAX index .GDAXI lost 0.8 percent, UK's FTSE 100 index .FTSE dropped 0.7 percent and France's CAC 40 .FCHI shed 1.3 percent. Continued...
