* FTSEurofirst 300 index ends flat after choppy session
* Next slips after results; drags retailers down
* U.S. employment, ADP numbers provide some support
By Atul Prakash
LONDON, Aug 4 (Reuters) - European equities ended flat on
Wednesday as better-than-expected U.S. services and private
sector employment figures offset weaker retail shares that fell
on concerns of a decline in consumer demand.
The choppy session witnessed weaker banks, with the STOXX
Europe 600 banking index <.SX7P> down 0.4 percent. Standard
Chartered <STAN.L> fell 5.2 percent despite forecast-beating
earnings, as analysts said the beat was mainly due to lower bad
debts and further upside was limited due to its premium rating.
The FTSEurofirst 300 <> index of top European shares
closed flat at 1,071.02 points after falling as low as 1,058.65
points and rising to a high of 1,075.20 points during the day.
"Markets are struggling to understand what's happening and
whether to put emphasis on the good part of the news or on the
bad part, and this explains the nervousness," said Philippe
Gijsels, head of research at BNP Paribas Fortis Global Markets.
The market got some support from macro-economic numbers,
with figures showing U.S. private sector employment rose
slightly more than expected in July, easing some concerns about
labour market weakness ahead of a key government jobs report
later this week. []
A report by ADP Employer Services showed U.S. private
employers added 42,000 jobs in July, while the euro zone's
dominant service sector picked up speed last month, allaying
fears of a double dip recession.
"We are trying again to move on the upside. But don't expect
a too aggressive rally as you have only very selective buying in
different shares," said Achim Matzke, strategist at Commerzbank
in Frankfurt.
"The technical picture looks positive."
The Euro STOXX 50 <>, the euro zone's blue-chip
index, rose 0.2 percent to 2,825.08 points to stay above its
200-day moving average and the 61.8 percent Fibonacci
retracement of the index's fall from an April high to a May low,
generally a bullish signal.
The index pierced the two key resistance levels on Monday.
LLOYDS, SOCGEN UP ON RESULTS
The banking sector as a whole was down but some individual
banks advanced. Part-nationalised Lloyds <LLOY.L>, Britain's
biggest retail bank, was up 3.6 percent as it beat forecasts to
swing to its first profit in two years and said it expected to
deliver a strong medium-term performance.
Societe Generale <SOGN.PA> was up 0.7 percent as it beat
forecasts with an almost fourfold leap in second-quarter net
profit, but the French bank warned that the economic recovery
was still fragile. []
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Graphic showing European banks earnings:
http://graphics.thomsonreuters.com/CoNews/EZ_BKSPR0710.html
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But retailers lost ground after Next <NXT.L>, Britain's
second-largest fashion chain, said it expected a fall in
first-half underlying sales to deepen in the second half.
Next slumped 7.7 percent, while Carpetright <CATVU.L>,
Britain's biggest floor coverings chain, was down 3.4 percent as
it reported a drop in underlying sales and said it was planning
for spending to stay subdued for the rest of 2010.
"The market is quite vulnerable and volatile, with low
volumes, as there is a lack of 'by and hold' investors. Insurers
remain on the sidelines, while institutional and retail
investors are still jittery," said Frederic Buzare, global head
of equity management at Dexia Asset Management.
"So it's a market of index trackers and hedge funds who play
short-term moves, hence the wild swings."
French utility EDF <EDF.PA> featured among the top gainers,
up 5.5 percent, after the French government proposed an average
increase in state-set electricity tariffs from Aug. 15 of 3
percent for households and 4 to 5.5 percent for companies.
(Additional reporting by Blaise Robinson in Paris; Editing by
Jon Loades-Carter)
