* FTSEurofirst 300 retreats from fresh highs hit on Thursday
* Telefonica falls after Q1 profits miss forecasts
* Prospect of new ECB stimulus keeps some traders bullish
By Sudip Kar-Gupta
LONDON, May 9 European shares slipped back on
Friday as disappointing business updates from leading companies
such as telecoms operator Telefonica sobered the mood
after a rally on the previous day.
The pan-European FTSEurofirst 300 index, which on
Thursday hit a 2014 peak of 1,359.07 points which marked its
highest level in around 6 years, fell 0.2 percent to 1,356.50
points in early session trading.
The euro zone's blue-chip Euro STOXX 50 index
also retreated by 0.4 percent to 3,192.70 points. The
FTSEurofirst 300 and Euro STOXX 50 both remain up by around 3
percent since the start of 2014.
Shares in Spanish group Telefonica fell 2.2 percent
as the company posted a 23 percent fall in first quarter net
profits that missed market expectations.
Energy services group Petrofac also slumped by 15
percent after it issued a profit warning.
Nearly two-thirds of companies listed on the pan-European
STOXX Europe 600 index have posted first-quarter
updates so far, and half of them have missed consensus
forecasts, according to Thomson Reuters StarMine data.
"A net 26 percent of European companies have missed on the
top-line so far in this reporting season, the worst since the
dark days of 2009," said UBS European equity strategist Nick
Terry Torrison, managing director at Monaco-based McLaren
Securities, expected European equity markets to make little
progress and drift in the coming months.
However, he expected European equities to then push higher
in the second half of 2014, buoyed by expectations that the
European Central Bank (ECB) could inject new measures - such as
a rate cut - to support the region's economic recovery.
ECB President Mario Draghi said on Thursday that the ECB was
ready to take action next month to boost the euro zone economy
if updated inflation forecasts merited such a move.
"In the short-term, we may drift, but I'm still bullish on
the second-half of this year. At some point, Draghi is going to
come up with something," he said.
Europe bourses in 2014: link.reuters.com/pap87v
Asset performance in 2014: link.reuters.com/gap87v
Today's European research round-up
(Additional reporting by Francesco Canepa; Editing by Toby