* FTSEurofirst 300 ends 0.3 pct lower after choppy trade
* Financial shares among top decliners, but oils gain
* Automakers skid; Volkswagen slips 14 percent
By Atul Prakash
LONDON, Aug 19 (Reuters) - European equities ended lower on
Wednesday, with banks and autos leading the fall, as investors
scaled back their trading positions after heavy losses in Asia
and on concerns about the pace of the global economic recovery.
The FTSEurofirst 300 <> index of top European shares
closed 0.3 percent lower at 931.98 points after trading in a
range of 920.28-934.68.But the index is still up 44 percent
since a record low in March and has gained 12 percent this year.
"We are expected to experience a short period of
consolidation after such a significant surge in the market -- an
increase of about 20 percent in equity markets in three to four
weeks," said Romain Boscher, head of equity management at
Groupama Asset Management.
"We are convinced that in September, people will reallocate
money in favour of risky assets."
Financial stocks were among top decliners, with Standard
Chartered <STAN.L>, HSBC <HSBA.L>, Barclays <BARC.L>, Royal Bank
of Scotland <RBS.L>, BNP Paribas <BNPP.PA> and Societe Generale
<SOGN.PA> down 0.5 to 2.2 percent.
A survey by accountants KPMG found that Britain's banks are
likely to see their battered retail arms slide to a loss in the
second half of 2009, as the cost of bad loans, tough competition
and wholesale funding continues to weigh. []
UBS <UBSN.VX> fell 1 percent on news the Swiss government
will hand over details of about 4,450 bank accounts to U.S.
authorities as part of a deal struck with Washington over
UBS.[]
Automakers were led lower by Volkswagen <VOWG.DE>, which
slipped 14 percent after a German magazine said Qatar paid
Porsche <PSHG_p.DE> hardly more than half the current market
price for shares of Volkswagen in a multi-billion euro deal
announced last week. []
Both Porsche, which gained 3.7 percent, and VW declined to
comment. Qatar could not immediately be reached for comment.
Daimler AG <DAIGn.DE>, Peugeot <PEUP.PA> and Renault
<RENA.PA> fell 0.8-2.1 percent.
CHINA FACTOR
The European stock market also came under pressure after the
Shanghai composite index <> slid 4 percent to a two-month
closing low on disappointment that authorities were not taking
steps to support the market amid heavy losses. It has fallen 20
percent in two weeks, rattling global markets.
"The markets were looking overbought and in need of a
correction," said Mike Lenhoff, a strategist at Brewin Dolphin.
"I do not think it is going to go very far. If anything the
supporting news flow is still very positive and interest rates
are going to remain where they are."
However, energy stocks ended in a positive territory,
tracking higher crude prices <CLc1>, which jumped 3.5 percent
following the American Petroleum Institute's report of a
surprising draw in crude oil inventories last week.
BP <BP.L>, Royal Dutch Shell <RDSa.L>, BG Group <BG.L>,
Tullow Oil <TLW.L>, Repsol <REP.MC> and StatoilHydro <STL.OL>
added 0.2-1.3 percent.
Eurasian Natural Resources Corporation <ENRC.L> was up 6.2
percent. It posted a sharp fall in first-half earnings but the
drop was smaller than expected and the miner predicted further
recovery in the second half. []
Telekom Austria <TELA.VI> rose 5 percent after it kept its
outlook for this year's core earnings along with second-quarter
results in-line with analyst forecasts, defying market
expectations of a profit warning. []
Across Europe, Britain's FTSE 100 index <> rose 0.1
percent, Germany's DAX <> fell 0.4 percent and France's
CAC 40 <> ended flat.
(Additional reporting by Joanne Frearson; Editing by Rupert
Winchester)
