* FTSEurofirst 300 down 0.03 pct, Euro STOXX 50 flat
* Investors eyeing Draghi's press conference on Thurs
* Stock picking to thrive in the next months -Thebault
By Blaise Robinson
PARIS, Oct 2 European stocks pared early losses
and steadied on Tuesday, with investors looking for clues on
whether Spain will soon request a bailout that would ease fears
of contagion from the euro zone debt crisis.
Alstom tumbled 5.8 percent, the biggest loser
among European blue chips, after the French transport and power
engineering company launched a capital hike of 350 million euros
($451.68 million) to finance an investment in a Russian rail
At 0821 GMT, the FTSEurofirst 300 index of top
European shares was down 0.03 percent at 1,104.54 points after
surging 1.4 percent on Monday.
According to senior euro zone sources, Spain is ready to
request a bailout as early as next weekend but German officials
said Madrid should hold off, creating confusion among investors.
"There are worries over whether or not it will be a bailout
and whether such a bailout would trigger credit downgrades,"
said David Thebault, head of quantitative sales trading at
"But beyond that, markets have not completely realised how
powerful the new ECB policy is and how it will reshape things,
so there's still upside."
At this week's policy meeting, the European Central Bank is
seen leaving interest rates on hold, but investors' focus will
be on the tone of ECB head Mario Draghi's press conference.
Draghi's comments in late July - when he said the central
bank was ready to do whatever it takes to save the euro -
sparked a rally in shares, with the Euro STOXX 50 up 15 percent
since then and the euro zone bank index up 42 percent.
"It's time to go back to stock picking, to look for the
companies full of cash, the market leaders, and the ones exposed
to the zones where economic growth is, such as emerging
markets," Thebault said.
Energy stocks were among the main losers on Tuesday, with
Repsol down 1.5 percent and Total down 0.9
percent, as crude oil prices remained under pressure due to
worries over the demand outlook.
Banking shares were volatile, with Societe Generale
down 1.1 percent while Deutsche Bank was up
Around Europe, UK's FTSE 100 index was down 0.1
percent, Germany's DAX index was flat and France's CAC
40 was off 0.2 percent.
The euro zone's blue chip Euro STOXX 50 index
was flat at 2,499 points, after losing ground in early trade but
managing to stay above a key support level, its 50-day moving
average, tested on Monday.
For Petra von Kerssenbrock, technical analyst at
Commerzbank, the blue chip index remains in a consolidation mode
although the medium-term upside trend is still intact.
"The Euro STOXX 50 is in a bottom pattern below the
resistance at 2,600-2,611 (a peak hit in March). Short term, the
index should see a trading market between 2,330 and 2,600," she