The pan-European Dow Jones Stoxx 600 index (ST:SXXP 235.54, -0.91, -0.39%) traded down 0.3% at 235.73, extending Wednesday's decline which snapped a four-session winning run.
Overall, the French CAC-40 index (FR:PX1 3,661, -7.51, -0.21%) lost 0.1% at 3,665.19, the German DAX 30 index (DX:DAX 5,479, -42.56, -0.77%) lost 0.7% at 5,483.57 and the U.K. FTSE 100 rose (UK:UKX 4,880, -10.48, -0.21%) slipped 0.1% to 4,887.11.
DAX 5,479, -42.56, -0.77%
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FAJA
Stefan Bielmeier, a strategist at Deutsche Bank, said his prior call for the DAX not to top 5,200 and for it to fall to 4,000 later clearly did not work out but he's still cautious, citing risks in the global financial system and the economy. He expects the DAX to fall to 4,800 by the end of the year.
Asian shares were lower and U.S. stocks were mildly lower in early trading. On Thursday, U.S. data showed that the recession eased some in the second quarter and weekly jobless claims fell for the first time in three weeks
Autos were paring gains made this quarter, with Daimler (DE:DAI 31.47, -0.88, -2.72%) (DAI 44.26, -1.94, -4.20%) shares down 2.9% and BMW (DE:BMW 31.97, -0.44, -1.34%) shares down 1.8%.
Food and drink shares were also weak, with Diageo (UK:DGE 958.00, -42.50, -4.26%) (DEO 61.67, -2.62, -4.08%) shares falling 4.2%.
The firm reported a 7% rise in fiscal-year net profit to 1.6 billion pounds ($2.6 billion) but warned that 2010 would be "challenging," with its operating profit growth seen slowing.
"Headline earnings before interest and tax at 2.6 billion pounds was 2% light of our estimate as margins in the North American and International divisions disappointed," said analysts at Evolution Securities. See full story.
Elsewhere in the sector, shares of Irish drinks firm C&C Group (UK:CCR 2.57, +0.36, +16.36%) rose 16.4% in London.
The firm said that it's buying the Irish, Northern Irish and Scottish businesses of Anheuser-Busch InBev (BE:ABI 29.10, -0.56, -1.89%) for 180 million euros. It also affirmed fiscal-year financial guidance. AB-InBev shares declined 1.9% in Brussels.
Credit Agricole (FR:ACA 13.06, +0.49, +3.89%) rose 5% in Paris.
The French bank's second-quarter net profit jumped to 201 million euros ($286 million) from 76 million euros, beating analyst forecasts as its net banking income rose 40.3% to 4.56 billion euros. See full story.
Other banks performing well included Natixis (FR:KN 3.63, +0.42, +13.14%) , which built on sharp gains made Wednesday with a 13.3% rise after an upgrade to buy from sell at Citigroup.
Shares of GDF Suez (FR:GSZ 30.07, +0.81, +2.77%) rose 2.8%, helping the utility sector put in a strong performance. The firm's first-half net profit fell 6.3% to 3.26 billion euros, beating market expectations.
Hotels group Accor (FR:AC 36.87, +1.82, +5.20%) jumped 5.2% after saying its board will review the benefits of separating its hotel business from the division that provides employee-benefits services to companies.
Accor swung to a first-half net loss of 150 million euros ($214 million).
Mobile phone maker Nokia (FI:NOK1V 9.20, +0.37, +4.19%) (NOK 13.38, +0.25, +1.90%) saw its shares rise 3.5%.
It will start a unit called solutions as of Oct. 1 that is designed to more tightly integrate its devices and customer services. Nokia also launched a new Linux-based phone.
Sarah Turner is a markets reporter for MarketWatch i
