* FTSEurofirst 300 down 0.6 percent
* Zurich Insurance weakens; Q2 net profit drops
* Analysts see period of consolidation on Euro STOXX 50
By Tricia Wright
LONDON, Aug 15 European equities gave back some
of their recent strong gains on Thursday, in holiday-thinned
volumes, led lower by Zurich Insurance on downbeat
The Swiss insurer said net profits fell by a bigger than
expected 27 percent in the second quarter, weighed by flooding
in Europe, tornadoes in the United States and meagre investment
It also sounded a cautious outlook about reaching its
targets, helping send its shares 3.2 percent lower.
Zurich's trading volumes were robust, at around 75 percent
of its 90-day daily average after less than an hour's trade,
against the FTSEurofirst 300 on 21.5 percent.
According to Thomson Reuters StarMine, 86 percent of the
STOXX Europe 600 companies have announced
second-quarter results so far, of which 56 percent have met or
The FTSEurofirst 300 fell 0.6 percent to 1,233.30
by 0747 GMT, still within sight of its 2013 peak of 1,258.09.
The euro zone's blue-chip Euro STOXX 50, which on
Wednesday hit its highest level in two years at 2,855.89,
slipped 0.3 percent to 2,842.67 points.
Dampening the mood were concerns the U.S. Federal Reserve
might, from next month, start cutting back its stimulus - one of
the major drivers of this year's equity market rally.
St. Louis Federal Reserve President James Bullard said late
on Wednesday the Fed risked pushing inflation even lower if it
tapered bond purchases too aggressively.
Selling on Wall Street accelerated after his comments as
some investors speculated a decision to trim stimulus could be
taken within weeks. A Reuters poll also showed on Wednesday a
majority of economists expected the Fed to reduce bond purchases
at its Sept. 17-18 policy meeting.
"After the massive ... rally over the past six weeks, Fed
tapering remains a concern going forward and that is why further
gains might be hard to achieve for the moment," said Lex van
Dam, hedge fund manager at Hampstead Capital, which manages
around $500 million in assets.
Technical analysts saw scope for consolidation on the Euro
STOXX 50 which, despite Thursday's declines, is on course for
its sixth consecutive weekly gain, having risen some 14 percent
since its late June low.
"The E50 is testing its highs, a natural area for a pause of
a few days; support at 2,775 may contain the fall," said Valerie
Gastaldy, head of Paris-based technical analysis firm Day By
"There is no sell signal yet, but with these thin summer
volumes, we think it is wise to be quiet and wait for a better
opportunity to buy," she added.