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Euro shares close a strong quarter lower

Friday, September 28 17:14:52

European shares ended the quarter with a whimper as fund managers banked gains on stocks that drove a strong rally over the last three-months and switched their focus to concerns over corporate earnings and the macro economy.

The FTSEurofirst 300 provisionally closed down 12.09 points, or 1.1 percent, at 1,091.17, though with volumes light, at 80 percent of the 90-day daily average. The index has traded in a tight 40-point range since early September.

The Euro STOXX 50, which has enjoyed its best quarter in three years, shed 1.8 percent on the last session of the three month period.

The index of euro zone blue chip companies emitted a bearish signal after it fell through support at the 23.6 percent Fibonacci retracement of the late July to mid-September rally.

"The rally has been driven by central banks stimulus. For markets to push on we need much stronger performance from the corporates and the macro economy, and there the news is getting worse rather than better," said Andrew Milligan, head of global strategy at Standard Life Investments, which has 157.6 billion pounds of assets under management.

Spain's IBEX fell 1.7 percent after adding 17 percent since early July. Banks fell 1.5 percent on Friday, having added around 15 percent in the quarter after European Central Bank president Mario Draghi pledged to do whatever it takes to save the euro, and effectively slashed the risks of the financial system failing. (C ) Reuters