* FTSEurofirst 300 down 0.3 pct
* Reverses earlier gains as Wall Street opens lower
* U.S. budget deal seen opening the door for Fed taper
By Toni Vorobyova
LONDON, Dec 11 European shares eased in late
trade on Wednesday, as increased certainty over U.S. government
spending following a budget deal there was overshadowed by
growing expectations that a scaling back of Federal Reserve
stimulus is imminent.
U.S.-exposed stocks such as cement-maker Lafarge
and defence contractor BAE Systems were among the
beneficiaries after budget negotiators in Washington reached a
provisional two-year deal to avoid another government shutdown.
Their shares added 2.6 and 2.4 percent respectively.
For the broader market, though, the implications were less
clear, with some suggesting a resolution on the budget could
pave the way for the Fed to start scaling back its
equity-friendly stimulus as soon as next week's meeting.
"It's good news, but ... as there is more evidence of such
an agreement everybody will think that the Fed will have no
reason to wait more to reduce their purchases of bonds and asset
backed securities. So it's good news, but is it good enough?"
said Vincent Guenzi, chief strategist at Cholet Dupont.
The FTSEurofirst 300 was down 0.3 percent at 1,258.89 points
by 1510 GMT, having given up earlier gains after Wall
Street opened lower.
Royal Bank of Scotland led the fallers in Europe
with a 3.3 percent drop after its finance director, Nathan
Bostock, resigned to join Santander.
The biggest boost, meanwhile, came from EADS,
which rose first on the U.S. news and then extended gains after
the aerospace company pledged to grow its dividends and
reaffirmed targets on operating profits.
"It's a top pick for me, so I am confident on the company,"
Cholet Dupont's Guenzi said.
"As they reconfirmed their margin targets, I think that is
very good for the near term, and for next year. The stock is not
very expensive so I think you can still target ... 10 percent
just to regain the discount with Boeing."
EADS shares were up 7.6 percent, on track for their biggest
one-day rally in a year and in heavy volumes already more than
double their 90-day daily average.
Activity on the broader market was more subdued, with
uncertainty over Fed policy keeping many players away. An hour
before the close, volumes for the FTSEurofirst 300 were just 42
percent of their daily average.
Turnover in the euro zone's blue-chip EuroSTOXX 50
was near 40 percent of its daily average, with the
index down 0.1 percent at 2,958.70 points.
The EuroSTOXX 50 has dropped 4 percent in December, taking
it below its 50-day moving average to darken the near-term
"I'm not sure that we've seen the bottom ... Last week's
closing low, at 2,953, is now the key level and if that gives
way I think we could see a retreat back to 2,900," Charles
Stanley analyst Bill McNamara said.