* FTSEurofirst 300 ends 0.3 percent lower
* Pharma stocks, food producers among top decliners
* Financials, miners advance; Alcatel-Lucent up 5.1 pct
By Atul Prakash
LONDON, Feb 22 (Reuters) - European equities ended lower on
Monday after advancing in the previous five sessions as weaker
drugmakers and food producers put pressure on the market, but
analysts said overall momentum remained positive.
The FTSEurofirst 300 <> index of top European shares
closed 0.3 percent lower at 1,023.15 points after rising earlier
in the session to a high of 1,028.54, the highest since Feb. 3.
Volumes were about 85 percent of its 90-day daily average.
GlaxoSmithKline <GSK.L> dragged down drugmakers. It fell 2.6
percent after two U.S. drug safety reviewers recommended that
diabetes drug Avandia be pulled from the market.
Other pharma companies also slipped, with AstraZeneca
<AZN.L>, Merck <MRCG.DE>, Novartis <NOVN.VX>, Novo Nordisk
<NOVOb.CO>, Roche Holding <ROG.VX> and Sanofi-Aventis <SASY.PA>
falling 0.1 to 1.3 percent.
"We had pretty good gains over the past few trading
sessions, so there is no doubt that we are going to occasionally
pause for breath," said Henk Potts, analyst at Barclays Wealth.
"The recovery that we have seen recently just shows that
there is still demand for equities in the current investment
environment. The macro environment has stabilised a little bit
and concerns over Greece have been set aside, in the short term
at least," he added.
Greece's central banker said the country was prepared to
take extra fiscal measures to make sure it meets its
deficit-cutting targets, but said financial markets were
over-reacting to its financial woes. []
Greece's deficit rose to 12.7 percent of gross domestic
product in 2009, way above the EU's cap of 3 percent, and Athens
needs to sell some 53 billion euros of debt this year, including
at least 20 billion euros in April and May.
Food producers were also among leading decliners, with
Unilever <ULVR.L>, Danone <DANO.PA> and Kerry Group <KYGa.I>
falling 0.9 to 2 percent.
Energy stocks also came under pressure as crude oil prices
<CLc1> slipped from six-week highs. Royal Dutch Shell <RDSa.L>,
BG Group <BG.L>, Repsol <REP.MC> and Total <TOTF.PA> shed 0.3 to
0.9 percent.
FINANCIALS IN DEMAND
But financials were among the top gainers, with Standard
Chartered <STAN.L>, HSBC <HSBA.L>, Barclays <BARC.L>, Lloyds
<LLOY.L>, Royal Bank of Scotland <RBS.L>, BNP Paribas <BNPP.PA>,
Societe Generale <SOGN.PA>, Credit Agricole <CAGR.PA> and
Natixis <CNAT.PA> rising 0.7 to 4.9 percent.
Some optimism emerged following data on Friday showing U.S.
consumer prices edged higher in January, while prices excluding
food and energy fell for the first time in 27 years, supporting
the Federal Reserve's contention it would keep its benchmark
interest rate low for an "extended period."
Last week's surprise rise in the Federal Reserve's emergency
lending rate initially spooked investors, some of whom feared
the move would bring forward broader policy tightening.
A group of U.S. business economists also raised their
forecast for economic growth over the coming year, saying
economic expansion was firmly on track, a survey released on
Monday showed. []
"Overall, stock markets are still positively positioned for
further gains medium-term," said Tim Hughes, head of sales
trading at IG Index.
"There is scope for some sort of pullback in the days ahead,
but this will most likely simply pull in buyers who have been
caught on the hop by the speed of the recent rise."
Miners were also in positive territory on hopes of a global
economic recovery. Antofagasta <ANTO.L>, Rio Tinto <RIO.L>,
Xstrata <XTA.L> and Eurasian Natural Resources <ENRC.L> rose 0.4
to 3 percent.
Among individual movers, telecoms gear group Alcatel-Lucent
<ALUA.PA> gained 5.1 percent after Bofa Merrill Lynch puts the
company on its list of recommended buys.
German construction company Bilfinger Berger <GBFG.DE>
slipped 6 percent after the company said late on Friday it has
widened the scope of its investigation in connection with an
urban rail project in Cologne.
