* FTSEurofirst down 0.3 pct, Euro STOXX 50 falls 0.6 pct
* Worries over Cyprus and Slovenia weigh on markets
* Swiss Re falls as stock goes ex-dividend
By Sudip Kar-Gupta
LONDON, April 12 European shares edged lower on
Friday after four days of gains, with some traders citing
concerns that Cyprus may need more bailout money as the main
factor weighing on markets.
The pan-European FTSEurofirst 300, which had risen
for the last four sessions, slipped 0.3 percent to 1,189.31
points, while the euro zone's blue-chip Euro STOXX 50
index declined 0.6 percent to 2,659.14 points.
European Union finance ministers are meeting on Friday and
Saturday, with Cyprus' bailout among the top items on the
Luxembourg's finance minister reiterated on Friday that
Europe and the International Monetary Fund could not increase
their 10 billion euro ($13.13 billion) contribution to the
bailout, but worries remain over Cyprus' economy.
Cyprus and the European Union have agreed in principle how
it will provide its 13 billion euro contribution to a bailout
package, although that number is almost twice the original
figure because of its sharp recession, fuelling concerns about
whether the sums will add up in the longer run.
"There is the potential that Cyprus may need more money, and
that may be a reason for investors to book a bit of profit on
the back of the recent strong run," said Central Markets chief
strategist Richard Perry.
Toby Campbell-Gray, head of trading at Tavira Securities,
said investors were generally nervous ahead of the minister's
meeting, in the wake of the strict bailout conditions imposed on
Cyprus which hit wealthy Cyprus bank depositors.
"There is zero confidence in the EU finance ministers to
come up with the correct solution. Is Cyprus a worry? Yes, but
it's less of a worry than the fact that we may see another crazy
course of action from the EU finance ministers," he said.
SLOVENIA WORRIES GROW
Pledges of liquidity from the European Central Bank (ECB)
have supported European equity markets over the last year, with
the FTSEurofirst 300 up some 5 percent since the start of 2013.
But the troubles in Cyprus have highlighted how far the
region's sovereign debt crisis may still have to run. Bad loans
in Slovenia's banking sector suggest it may be next in line
although Eurogroup chief Jeroen Dijsselbloem said the country
was not on the agenda for Friday's meeting.
The festering uncertainty over the euro zone's economy
caused the STOXX Europe 600 Banking Index to slip 1
percent to make it the worst-performing equity sector.
The STOXX Europe 600 Insurance Index also fell 0.9
percent, as reinsurer Swiss Re dropped 8.7 percent,
although traders said this was mainly down to the fact that
Swiss Re went ex-dividend on Friday, after which investors will
no longer qualify for its latest dividend payout.
Although most traders and investors expect European equities
to rise gradually over the course of 2013, some expect a
pull-back in the second quarter as many investors seek to cash
in on the rally since the start of the year.
Tracy Knudsen, senior vice president at technical trading
analysis firm Lowry Research, said the Euro STOXX 50 and German
DAX indexes could both lose ground in the near term.
She said the Euro STOXX could go back to its November levels
of around 2,430 points if any decline in the coming weeks pushed
it below the 2,600 point level.
"The poor internal condition of the markets in the European
region warns of the increased risk of a further breakdown in the
coming weeks," she said.