* FTSEurofirst 300 index falls 0.5 percent
* H&M drops after misses quarterly profit forecasts
* Vedanta falls on India unit copper smelter shut
* For up-to-the minute market news, click on []
By Joanne Frearson
LONDON, Sept 29 (Reuters) - European shares fell on
Wednesday, with investor uncertainty about the global economic
recovery weighing and retailers slipping as Hennes & Mauritz
<HMb.ST> missed quarterly profit forecasts.
Retailers were the worst performers, with the STOXX Europe
600 Retail <.SXRP> down 1.6 percent. Swedish fashion group
Hennes & Mauritz <HMb.ST> fell 6.1 percent after its profit
margins weakened and as concerns grew over the prospect of more
cost pressures in coming months. []
By 0923 GMT, the pan-European FTSEurofirst 300 <>
index of top shares was 0.5 percent lower at 1,065.76 points
after falling 0.3 percent on Tuesday when data showed U.S.
consumer confidence dropped to its lowest level since February.
"Investors are nervous and want to take some profits,"
Philippe Gijsels, head of research at BNP Paribas Fortis Global
Markets in Brussels said. "We have been range trading over the
last few days and there is still uncertainty about economic
fundamentals."
Miners reversed earlier gains as the STOXX Europe 600 Basic
Materials <.SXPP> index fell 0.6 percent. Vedanta <VED.L> lost
4.8 percent after its Sterlite Industries <STRL.BO> operations
closed its Tuticorin copper smelter in south India after a court
order.
Earlier the sector had been lifted by pleasing China PMI
figures, while separately the world's top iron ore miner Vale
said steel demand growth in China will revive by early 2011.
[] []
BANKS PRESSURED
Banks were under pressure as worries over the global
economic recovery weighed. Sentiment was weakened after The
Irish Times reported the final cost of winding down Anglo Irish
over a 15-year period may rise well above 30 billion euros
($40.4 billion) under a worst case or "stress scenario".
Deutsche Bank <DBKGn.DE>, Societe Generale <SOGN.PA> and
Commerzbank <CBKG.DE> slipped 1.8 to 2.8 percent.
The technical picture was bearish. The Euro STOXX 50
<>, the euro zone's blue-chip index, slipped 0.4
percent to 2,762.41 points, below its 200-day moving average of
2,774.67 points after falling a hair below it on Tuesday.
The index was also under the 61.8 percent Fibonacci
retracement of the index's fall from an April high to a May low
at 2,805.95 points, with analysts suggesting it will face strong
resistance at this level.
The VDAX-NEW volatility index <.V1XI>, one of Europe's main
barometers of investor anxiety, rose 2.8 percent but remains in
a tight range in which it has oscillated for nearly a month, and
the chart signals an imminent spike in volatility that could
mean a stock market pull-back.
"This is not reassuring. We're in the last few days of the
quarter, and we can't break out of the range on the upside. It's
like if people are bracing for the bad news that will trigger a
pull-back," says David Thebault, head of quantitative sales
trading, at Global Equities.
Meanwhile, regulators are preparing to issue a report on
last May's stock market "flash crash".
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Across Europe, the FTSE 100 <> index was 0.4 percent
lower, Germany's DAX <> was down 0.6 percent and France's
CAC 40 <> fell 0.5 percent.
The Thomson Reuters Peripheral Eurozone Countries Index
<.TRXFLDPIPU> was 0.5 percent lower.
(additional reporting by Blaise Robinson; Editing by Hans
Peters)
