* FTSEurofirst 300 down 0.2 pct, Euro STOXX 50 down 0.3 pct
* Indexes lose steam as big resistance levels loom
* Emerging markets worries weigh on luxury goods makers
* Tensions in Ukraine keep investors on edge
By Blaise Robinson
PARIS, Feb 26 European stocks dipped on
Wednesday, taking a breather from their sharp three-week rally,
with shares in luxury goods makers under renewed pressure due to
their big exposure to emerging markets.
Credit Suisse was also in the spotlight, losing
2.5 percent as a U.S. Senate subcommittee alleged new misdeeds
by the Swiss lender. The bank's officials are expected to stress
that only a small group of Swiss-based private bankers had
helped clients evade taxes, according to a person familiar with
the bank's thinking.
The FTSEurofirst 300 index of top European shares
ended 0.2 percent lower at 1,348.75 points, following a 7
percent rise from a low hit on Feb. 4.
The euro zone's blue-chip Euro STOXX 50 index
ended 0.3 percent lower, at 3,148.19 points.
The market's recent brisk rally - fuelled by a relatively
positive earnings season and signs of a pick-up in economic
growth in Europe - has propelled some regional stock indexes to
major resistance levels, with both the UK's FTSE 100 and
Germany's DAX trading within sight of record highs.
"Indexes in Europe are still in a bull trend, and it's very
strong. But there are key resistances to be crossed. Investors
should take advantage of all the dips to buy," Aurel BGC
chartist Gerard Sagnier said.
Shares in luxury goods makers featured among the top losers
on Wednesday, with Louis Vuitton owner LVMH down 1.6
percent and Gucci owner Kering down 2.2 percent, as
traders pointed to a downbeat note from Credit Suisse analysts
who downgraded the sector to 'benchmark' from 'overweight'
citing its big exposure to China and other emerging markets.
"The risks of structurally slower China growth as well as
the negative impact of China's anti-corruption measures on
high-end spending do not yet seem to be adequately reflected in
consensus expectations for luxury goods sales growth, which, at
12 percent on a 12-month forward basis, is close to the top end
of its 10-year range," the analysts warned in a note.
Luxury shares - which were seen as safe havens during the
heat of the euro zone debt crisis due to their strong exposure
to emerging markets - have fallen out of favour among fund
managers in the past few months, hurt by doubts about the pace
of growth in emerging countries.
LVMH's stock is down 10 percent since mid-September, while
both Hermes and Kering are down 15 percent over the
same period, strongly underperforming a 7 percent rise in the
French telecoms stocks also dropped on Wednesday as a price
war between the country's operators heated up with Bouygues
Telecom unveiling a cut-price bundle offer. Iliad
sank 5.8 percent and Orange fell 3.4
Around Europe, UK's FTSE 100 index fell 0.5 percent,
Germany's DAX index slipped 0.4 percent, and France's
CAC 40 shed 0.4 percent.
Investors were also kept on edge by tensions in Ukraine,
with volatile trading late in the European
Europe bourses in 2014:
Asset performance in 2014:
Today's European research round-up