* FTSEurofirst 300 down 0.3 pct
* Aggreko plunges 17 pct, cautions on 2013 outlook
* KPN shares slides 14 pct after dividend cut
By Tricia Wright
LONDON, Dec 17 European shares fell at the start
of what could be a choppy week on Monday given uncertainty over
whether a budget deal can be struck in Washington,
They were led lower by temporary power provider Aggreko
after a negative update.
The FTSEurofirst 300 was down 0.3 percent at
1,130.18 by 1214 GMT. The index dipped 0.1 percent in the
previous session, having on Thursday snapped an eight-session
winning streak which had seen it hit a fresh 2012 high of
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.
A proposal for tax hikes on incomes over $1 million a year
from U.S. Republican House Speaker John Boehner on Sunday was
seen as a move towards agreement, but it remains far off
President Barack Obama's position.
While many in the market believe a deal on the U.S. budget
will be reached, any news to the contrary could open the way to
significant index falls, particularly in light of seasonally
"Stocks are at their highs for the year so the risk is more
to the downside than the upside," Michael Hewson, senior analyst
at CMC Markets, said. "For the markets to go higher you need
some resolution, or some possibility of a resolution - and there
Trading volume on the FTSEurofirst 300 stood at a third of
its 90-day daily average, with volume on Monday highly
concentrated in stocks affected by disappointing newsflow.
Aggreko took the hardest hit in terms of percentage, off 17
percent, after it warned on the outlook for its business in a
trading update, prompting Investec Securities to cut its rating
on the stock to "hold" from "buy".
"Today's news will be seen as a something of a setback...
That said, we continue to believe that there are many structural
drivers that should continue to drive earnings in the years to
come," Investec said in a note.
Volume in Aggreko was more than four times its daily
Telecoms group KPN slid nearly 14 percent, leading
falls seen among peers, after the Dutch state raised much more
than expected in its auction of fourth generation (4G) wireless
frequencies, with prices so high KPN cut its dividend for this
year and next to afford its licences.
Trading volume in KPN was also robust at more than four
times its 90-day daily average.
Heavyweight Vodafone was another significant faller,
off 2.6 percent and knocking most points off the index. Its
trading volume stood at 86 percent of its 90-day daily average.
"Continually on slow days where there isn't a considerable
amount of news we tend to get slippage on one, two, three stocks
where it does a high degree of damage," Andy Ash, head of sales
at Monument Securities.