* FTSEurofirst 300 down 0.3 percent
* Pharmaceuticals weak, led by AstraZeneca
* Euro STOXX 50 technical analysis bullish
By Tricia Wright
LONDON, Dec 13 European shares dipped on
Thursday as new stimulus steps from the Federal Reserve were
overshadowed by concern over U.S. austerity measures, though
traders made light of the falls after a recent powerful rally.
The FTSEurofirst 300 was 0.3 percent lower at
1,136.29 by 1159 GMT, slipping after a steep three-week rally
which had seen the index rise in 16 out of 18 sessions
propelling it to 18-month highs.
Trading volumes were extremely thin, at a third of the
90-day daily average, exaggerating any moves on the index.
The Fed announced a new round of monetary stimulus on
Wednesday and indicated interest rates would remain near zero
until unemployment falls to 6.5 percent.
But a key issue continued to be worries over the U.S. budget
impasse, and whether the United States would miss a year-end
deadline to avert the "fiscal cliff" of some $600 billion of tax
hikes and spending cuts due to start in January.
Fed Chairman Ben Bernanke warned on Wednesday that monetary
policy would not be enough to offset damage from the fiscal
"There's definitely some profit-taking in play and the
optimism that the fiscal cliff can be averted is drying up now,
but with markets sitting at or around recent highs, any
uncertainty is going to see traders reining it in," said Mike
McCudden, head of derivatives at Interactive Investor.
Andy Ash, head of sales at Monument Securities, said: "I
think most people are trying to keep everything pretty tight and
pretty flat for the rest of the year, and at the moment we don't
see any significant reason why they shouldn't be able to do
"It's not really a fiscal cliff; it's more of a fiscal
slope. Even if they miss it by a month or two it's not going to
have the inherent damage instantaneously that people expect."
Weak drugmakers were the main drag on the index, led by a
2.3 percent drop from AstraZeneca in brisk volume after
it said an experimental rheumatoid arthritis drug proved
inferior to Abbott Laboratories' Humira in a clinical
The news dampened hopes for one of the few late-stage
products in the company's pipeline.
Trading volume in AstraZeneca was 113 percent of the 90-day
The euro zone's blue-chip Euro STOXX 50 was down
0.1 percent at 2,627.90, having hit a new closing high for the
year on Wednesday, at 2,630.34.
Even with the index close to "overbought" territory - its
relative strength index, a closely watched momentum indicator,
is just below 70 - some technical analysts remained optimistic.
"As long as the former mid-term top around 2,610 (former
2012 high) is support, we remain bullish," said Philippe
Delabarre, a technical analyst at Trading Central.
Delabarre targets 2,638, the day's high, and 2,650, a
psychological resistance level.