LONDON Feb 25 Uncertainty over the Italian
election outcome dragged European indexes off their highs on
concern that an unclear outcome could hamper the country's
effort to implement economic reforms.
The pan-European FTSEurofirst 300 index
provisionally closed up 0.1 percent at 1,166.73 points, off a
high of 1,174.24 points.
If no stable government is formed, voters could be forced to
return to the polls, thereby fuelling short-term market
Kevin Lilley, European equity fund manager at Old Mutual
Asset Managers, said he had sold off bank stocks in the run-up
to the Italian vote and could sell more equities if the
centre-right party headed by Silvio Berlusconi won the Senate.
"It will be 'risk-off' if Berlusconi wins. Italian bond
yields will go up in the short-term," he said.
Toby Campbell-Gray, head of trading at Tavira Securities,
said European equity markets would be choppy while the Italian
situation remained unclear.
"The market's going to become a little bit more volatile
until the conclusion of the vote," he said.