* FTSEurofirst 300 slips 0.1 pct to 1,140.80 points
* Euro STOXX 50 down 0.1 pct to 2,653.27 points
* Tech stocks weaken after Ericsson makes writedown
* Traders looking to go into year-end with "flat" books
By Sudip Kar-Gupta
LONDON, Dec 20 European equity indexes slipped
from multi-month highs on Thursday after new signs of friction
in U.S. budget talks, while a fall in mobile network maker
Ericsson also weighed on markets.
Many traders said they were looking for opportunities to
sell shares into any rally in order to lock in their profits
before the year-end, adding that some equity indexes looked
"overbought" on a technical basis and therefore poised for minor
The pan-European FTSEurofirst 300 index, which
closed near a fresh 19-month high on Wednesday, slipped 0.1
percent to 1,140.80 points, while the euro zone's Euro STOXX 50
index fell 0.1 percent to 2,653.27 points.
The STOXX Europe 600 technology index was the worst
performing sector, falling 0.5 percent after Swedish group
Ericsson announced a fourth-quarter writedown,
pushing its shares down 1.5 percent.
"There's too many suppliers in that sector," said
Clairinvest fund manager Ion-Marc Valahu, whose portfolio does
not contain any European technology stocks.
U.S. BUDGET UNCERTAINTY
U.S. politicians remain locked in talks to find a deal to
avoid a "fiscal cliff" of government spending cuts and tax rises
due to take effect in early 2013 that could hurt the world's
Although most investors expect a deal on the U.S. budget to
be struck eventually, signs of delays have opened the way to
fresh equity index falls, with moves often exacerbated since
volumes have been thin ahead of the Christmas holiday period.
Some traders added that European equity indexes were looking
"overbought" on a technical chart basis, giving them further
reason to sell shares.
The Euro STOXX 50 had stepped into "overbought" territory on
its 14-day its Relative Strength Index (RSI) for the first time
since 2009, which meant some investors could be looking to lock
in some profits at this level.
"Many investors are closing their positions to be flat into
the New Year," a Milan-based trader said. "There's very little
interest in opening new positions."
Central Markets senior broker Joe Neighbour said there were
still some traders looking to use declines in the equity market
to buy stocks on the cheap ahead of a possible rally in January,
but on the whole investors were not taking on big positions.
"If there are profits to be had, we'll be looking to take
them off the table. The dip buyers still seem to be there to
look to take the market back up but we'll be looking to keep
flat as we go into the new year," he said.