European shares extend losses as U.S. eyes lower open

LONDON Wed Feb 6, 2013 1:26pm GMT

LONDON Feb 6 (Reuters) - European equities extended losses in afternoon trade on Wednesday, weighed down by a string of disappointments from the earnings season and tracking a move lower by U.S. stock futures.

Fresh signs of political conflict in the euro zone also dented sentiment, with signs of disagreement between Germany and France over the euro exchange rate. The spokesman for German Chancellor Angela Merkel said on Wednesday that the euro is not overvalued, thus potentially reducing the chances of any political intervention to curb an exchange rate which analysts say could start hurting corporate profits.

The FTSEurofirst 300 was down 0.4 percent at 1,150.17 points by 1322 GMT, having failed to sustain modest gains printed at the start of the session.

EuroSTOXX 50 was down 1.5 percent, led by weakness in banking stocks.

"The volumes weren't particularly high this morning and it just got squeezed a little bit ... and with the Dow futures turning a bit south as well," said a London-based trader.