* FTSEurofirst 300 down 0.2 pct, Euro STOXX 50 down 0.1 pct
* U.S. data, Russia risk keep activity subdued
* Ryanair, Reckitt outperform on earnings, dealmaking
* German market underperforms on Russia exposure
(Adds comment, closing prices)
By Lionel Laurent and Blaise Robinson
LONDON/PARIS, July 28 European stocks edged
lower on Monday, with unspectacular U.S. data and new European
sanctions against Moscow offsetting strong earnings updates from
firms like Ryanair and spin-off talk from Reckitt
European equities have barely budged from their levels at
the end of June, inching back from multi-year highs on doubts
over the pace of economic recovery in the euro zone and the
impact of conflicts in Ukraine and across the Middle East.
The pan-European FTSEurofirst 300 index closed down
0.2 percent at 1,369.61 points, while the euro zone's blue-chip
Euro STOXX 50 index was down 0.1 percent.
An unspectacular reading for new business and employment
growth in the U.S. services sector, along with an unexpected
drop in U.S. pending home sales for June, weighed on trading.
Sentiment was subdued overall, with investors looking ahead
to a busy week of data and earnings from the U.S. and digesting
a recent batch of mixed trading updates from European firms.
"The U.S. PMI was slightly softer (than expected)," said
Jasper Lawler, analyst at CMC Markets.
Investors also held back from placing big bets as
geopolitical risks remained in focus. Russian markets tumbled
for a third straight session after the EU reached an outline
agreement on its first economic sanctions on Russia since the
downing of a Malaysian airliner over East Ukraine.
Meanwhile, in the Gaza Strip, a huge explosion in a public
garden killed eight children and two adults and wounded 40
others, Palestinian medics said on Monday. Locals blamed the
blast on an Israeli air strike but Israel denied responsibility,
saying it was a misfire by a rocket launched by Hamas.
"Tensions in Ukraine and Middle East, recent nasty surprises
in the earnings season... There's just a lack of visibility at
the moment which is prompting investors to just stay on the
sidelines," Talence Gestion fund manager Alexandre Le Drogoff
Airline Ryanair and consumer-goods group Reckitt Benckiser
were among the outperformers, with both up 2.7 percent after a
blowout quarter for the airline led it to raise its profit
forecast and after Reckitt said it planned to sell its
heroin-addiction treatment, worth $4.9 billion by some measures.
France's Danone was also among the top gainers, up 0.9
percent following a report that the food and beverage major is
in talks to sell its medical nutrition business to U.S. group
Hospira in a deal valuing the unit at about $5 billion,
or 3.7 billion euros.
"In the past, the price mentioned was 3 billion euros, so
this 3.7 billion euro tag is a better price," a Paris-based
On the downside, German automakers Daimler and
Porsche and Austrian lender Raiffeisen Bank
were both down over 3 percent. Banking-technology
group Wincor Nixdorf also fell 4.5 percent after it
slashed its sales forecast.
Germany, a top trading partner of Russia, is seen by
investors as relatively more exposed to the Ukraine crisis than
other markets. The Frankfurt blue-chip DAX index was
down 0.5 percent, underperforming the French CAC 40 and
the UK FTSE 100.
There was mixed news from the financial sector. Spain's
Bankia reported a near-doubling of quarterly profit on
the back of a sustained recovery for the country's banking
sector, though Germany's Commerzbank unveiled more pain ahead as
part of a wider savings programme that will cost more jobs.
Lloyds Banking Group ended the day flat after
agreeing to pay fines totaling $370 million to U.S. and British
authorities investigating its part in a global
interest-rate-rigging scandal and manipulating fees for a UK
government lending scheme.
Emerging markets-focused fund manager Aberdeen Asset
Management fell more than 5 percent after it said assets
under management dipped in the June quarter, with clients
withdrawing 8.8 billion pounds ($14 billion).
Data showed a sharp rise in profits earned by Chinese
industrial firms, up 17.9 percent in June from a year earlier,
fuelling expectations that the world's second-largest economy is
powering through its recent soft patch as the government uses
targeted stimulus measures to support growth.
Europe bourses in 2014: link.reuters.com/pap87v
Asset performance in 2014: link.reuters.com/gap87v
Today's European research round-up
(Editing by Tom Heneghan)