* FTSEurofirst 300 flat, Euro STOXX 50 down 0.1 pct
* Antofagasta surges after dividend raise
* VW hit by weak Audi results
By Francesco Canepa
LONDON, March 12 (Reuters) - European shares hovered just shy of 4-1/2 year highs on Tuesday as results from Antofagasta and auto maker Audi painted a mixed earnings picture, although charts showed investors were still prepared to buy market dips.
Miner Antofagasta was the top riser in Europe after the firm unveiled plans to more than double its dividend payout for last year, much more than expected, on the back of higher profits.
The firm’s stock rose 5 percent in volume 164 percent its full-day average for the past 90-days, Thomson Reuters data showed.
The stock topped the pan-European FTSEurofirst 300 index , which was flat at 1,194.64 points at 1223 GMT after swirling around the gain line for most of the morning.
Capping the index was German auto firm Volkswagen , down 1.4 percent, as results from its main profit driver, Audi, showed the world’s second-largest luxury carmaker is grappling with stagnant earnings.
The FTSEurofirst 300 was hovering just below a high of 1,197.73 hit on Friday and previously last seen in 2008.
Charts showed that each market dip was rapidly bought into, in a sign of underlying appetite for equities as monetary stimulus from central banks drove down returns on bonds and cash.
“These corrections are limited and short-lived because simply people understand (we are) in an environment of big opportunities,” William de Vijlder, chief investment officer at BNP-Paribas Investment Partners, said.
“The expected return structure has now moved more in favour of equities compared to other asset classes, so that would justify having strategically more equities.”
Annual returns offered by euro zone shares are 9.2 percent higher than those offered by Germany’s 10-year government bonds, Datastream data showed.
Daily charts on the euro zone Euro STOXX 50 index, down 0.1 percent at 2,716.35, also pointed to more upside as momentum on the index, as shown by its moving average convergence/divergence (MACD) indicator, picked up.
“The daily MACD is turning positive and is above its signal line,” Nicolas Suiffet, an analyst at Trading Central in Paris said.
“Thus, a new test of the resistance threshold at 2754.8 (the index’s 2013 top) remains the most likely scenario.”
He added a push above this level would open the way to a further advance towards 2787.3 points, a top last seen in 2011.
But some investors were growing wary of the market’s rally, which has seen the Euro STOXX 50 rise nearly 6 percent since late February,
While BNP Paribas’ de Vijlder was bullish on European shares on a multi-year view, he was tactically underweight the asset class as he awaited a better entry point after a correction.
He said this could be triggered if a political gridlock derails economic reform in Italy or if U.S. politicians fail to address the country’s urgent fiscal issues.
Traders said investors could start booking some of their profits later this week as Italian politicians start what are expected to be difficult talks to form a government after an inconclusive general election late last month.