* FTSEurofirst 300 index ends down 0.1 percent
* China's move to higher bank reserves drives early falls
* U.S. retail sales, JP Morgan earnings help pare losses
By Simon Jessop
LONDON, Jan 14 (Reuters) - European shares ended lower on
Friday after a fresh tightening in Chinese monetary policy hit
investor risk appetite, although more positive U.S. economic and
earnings data had helped pare losses by the close.
The FTSEurofirst 300 <> index ended down 0.1 percent
at 1,156.13 points, having been as low as 1,145.05, but remained
up 1 percent on the week thanks in large part to Wednesday's
surge to a 28-month high.
Miners were among the worst hit after China raised its bank
reserve requirements for the seventh time since early 2010 in
its attempts to tame inflation, fuelling fears growth would be
crimped and encouraging some investors to take profits.
The Europe STOXX 600 Basic Resources index <.SXPP> ended
down 1.6 percent, with Anglo American <AAL.L> and Antofagasta
<ANTO.L> among the worst hit, down 3.2 percent and 2.4 percent
respectively.
"There's been good and bad economic news this week," said
Philip Isherwood, head of equity strategy at Evolution
Securities, "but we still believe the economic story is one of a
developing strength".
The start to the earnings season had been reasonable, he
added, and, coupled with improving macroeconomic data, should
provide the tone for market direction in the short term.
"I fully admit inflation worries are there in emerging
markets, such as China, and there are concerns over the euro
zone periphery, but my own view is that the cycle will be driven
by the positive message from the corporate sector," he added.
Forecast-beating earnings from U.S. investment bank JP
Morgan Chase & Co <JPM.N> buoyed expectations for results
elsewhere in the sector, and helped the Europe STOXX 600 Banking
index <.SX7P> end up 0.5 percent. []
Among European banks, Credit Suisse <CSGN.VX> closed up 1.7
percent, while Barclays <BARC.L> gained 1.6 percent.
A modest rise in U.S. retail sales, and signs inflation was
under control, added to the late afternoon improvement in
European market sentiment, traders said. []
Technical chartists Paris-based Trading Central also backed
further gains for the blue-chip ESTOXX 50 index <> of
leading European shares, with target prices of 2,956 points and
3,100, against Friday's close of 2,920.40.
A bullish continuation pattern has been confirmed, said
analyst Philippe Delabarre, and momentum was supported by
widening Bollinger bands and an ascending trendline.
TECH BOOST
Tech stocks were among the biggest gainers in a well-traded
day that saw the broader market trade at 138 percent of its
90-day average, boosted by strong numbers overnight from U.S.
and sector heavyweight Intel Corp <INTC.O>. []
ARM Holdings <ARM.L> led gainers in Britain on the back of
the news, rising 5.3 percent, while Dutch-based ASML <ASML.AS>
was up 6.4 percent against a 0.6 percent gain in the wider
Europe STOXX 600 Technology index <.SX8P>.
"Intel's numbers beat most expectations by around 10 percent
and so we are seeing investors connect the dots from Intel's
earnings to other similar tech stocks trading in Europe to which
this may paint a similarly rosy picture," Joshua Raymond, market
strategist at City Index, said.
Sanofi-Aventis <SASY.PA> slipped 1.2 percent following a
report that two patients suffered liver failure after taking the
company's heart drug Multaq.
The company later confirmed two cases of acute liver failure
requiring transplants in patients treated with Multaq.
Across Europe, the FTSE 100 <> index ended down 0.4
percent, Germany's DAX <> closed flat and France's CAC 40
<> ended up 0.2 percent.
(Editing by David Hulmes)
