October 4, 2012 / 3:45 PM / 5 years ago

BASF hit as growth concerns cap European shares

LONDON, Oct 4 (Reuters) - European shares closed slightly lower on Thursday as a gloomy economic outlook continued to cap investor sentiment, with German chemicals giant BASF the latest to be hit.

Shares in the world’s largest chemicals maker fell 2 percent as the group announced it would have to cut costs and sell a business due to a decline in demand from southern Europe and Britain.

The FTSEurofirst 300 index provisionally closed 0.1 percent lower at 1,099.57 points, keeping within the 0.3 percent trading range that has trapped the index for most of this week, as coordinated stimulus action from global central banks underpinned underlying appetite for equities.

“With equities looking relatively better than bonds and cash in real terms, and in the context of large central bank activism, an underweight in equity is difficult to justify,” Stephanie Kretz, a member of the investment strategy team for private banking at Lombard Odier, said.

“However, an overweight is not appropriate either due to the large underlying structural issues and the diminishing marginal effects of quantitative easing over time.”

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