European shares drift lower

Thu, Aug 30, 2012, 01:00

European shares continued to drift lower today, with investors reticent about lifting their exposure to riskier assets given uncertainty over the next moves by the US Federal Reserve and the outlook for the global economy.

The FTSEurofirst 300 was down 0.4 per cent at 1,081.89 by 0710 GMT, having ended 0.2 per cent lower yesterday in volume at only 56 per cent of the 90-day daily average, making the session's volume one of the lightest this year.

The Euro STOXX 50, meanwhile, shed 0.4 per cent to 2,424.92. The index will find support at 2,418 points - a long-term descending trendline formed by its 2011 and 2012 peaks.

Investors will closely watch US Federal Reserve Chairman Ben Bernanke and other central bankers in Jackson Hole, Wyoming, at the end of the week at an annual get-together that often hints at forthcoming monetary policy moves.

"As investors count down the hours to Bernanke's speech at Jackson Hole they are clearly not prepared to take any chances, preferring to look for safe havens where they can be found," Mike McCudden, head of derivatives at Interactive Investor, said.

"Furthermore, the ripple effect being felt from a stuttering China and the downturn in the Aussie mining industry will acutely impact the euro zone which already has enough on its plate to contend with."

Reuters