By Atul Prakash
LONDON, Aug 27 (Reuters) - European shares slipped in early
trade on Friday and were on track for a third straight week of
losses as investors remained concerned about the pace of
economic recovery after recent grim macroeconomic data.
The market awaited the second estimate of U.S. GDP for the
second quarter and a speech by U.S. Federal Reserve Chairman Ben
Bernanke, who is likely to signal his views about the uncertain
prospects for the world's biggest economy.
By 0827 GMT, the FTSEurofirst 300 index of top European
shares was down 0.7 percent at 1,013.26 points after closing 0.9
percent higher in the previous session.
"We are going to have a bumpy couple of weeks, may be even
months ahead. We need to have some clear evidence for the U.S.
economy to turn the corner to get people to look at the equity
market again," said Franz Wenzel, strategist at AXA Investment
Managers in Paris.
U.S. economic growth between April and June would likely be
much weaker than initially thought, the GDP report, which is due
at 1230 GMT, is expected to show.
Financial stocks were among the top losers, with the STOXX
Europe 600 banking index falling 0.9 percent. Barclays, Royal
Bank of Scotland, Societe Generale and Natixis fell 1.3 percent
to 1.7 percent.
Commerzbank, Germany's second-biggest lender, fell 3.3
percent after German business daily Handelsblatt cited financial
sources as saying the company was planning a capital increase of
at least 5 billion euros ($6.37 billion) this fall.
A spokesman for the lender said on Friday that "there are no
concrete plans yet." Energy shares also lost ground as crude
oil prices fell 0.3 percent on concerns about energy demand in
the U.S. The STOXX Europe oil and gas index fell 1.1 percent,
while BP, BG Group and Total fell 0.8 percent to 2.3 percent.
Tullow Oil fell 4 percent after two Ugandan newspapers said
the Ugandan government had taken away the UK company's
exploration licence. Tullow Oil declined to comment.
The Euro STOXX 50, the euro zone's blue-chip index, fell 0.6
percent to 2,592.36 points and is down 1.9 percent so far this
"It looks bearish, but still has got plenty of support at
lower levels," said Phil Roberts, technical analyst at Barclays
Capital. He saw support at 2,534 points and further at 2,500.
"Longer term, it looks like it is still in a corrective
process after a rally (from April 2009 to January 2010) and
risks are for a move down towards 2,400," Roberts said.
On the upside, the index faces resistance at 2,670 points,
its 38.2 percent retracement level and again at its 50-day
moving average of 2,688 points.
Among individual stocks, Swiss drugmaker Novartis AG gained
0.5 percent. It received U.S. approval for a new treatment of
high blood pressure, broadening the use of Tekturna, the
successor to the group's best-selling drug, Diovan.
Spain's Iberia posted a narrower than expected first-half
operating loss as improving business travel and air cargo demand
eased the negative impact of a volcanic ash cloud in April. But
its shares fell 0.6 percent tracking the broader market.
(Editing by Sharon Lindores)