* FTSEurofirst 300 down 0.9 pct, hits 2-month low
* Dutch, Swiss, German stocks take a hit
* Spanish shares buck trend on bailout expectations
* Risks seen on the upside ahead of U.S. fiscal cliff
By Blaise Robinson
PARIS, Nov 15 European stocks ended lower on
Thursday after data showed the euro zone had slipped into
recession, with the Netherlands particularly hard hit.
The FTSEurofirst 300 index of top European shares
closed 0.9 percent lower at 1,078.64 points, a level not seen
since early September, while Amsterdam's AEX benchmark
tumbled 1.8 percent.
The French and German economies both managed 0.2 percent
growth in third quarter but the Dutch economy shrank by 1.1
percent, much more sharply than expected.
Shares in Franco-Dutch airline Air France-KLM fell
8.5 percent, telecom group KPN lost 5.3 percent and
retailer Ahold shed 2.2 percent.
Swiss and German stocks - which have been strongly
outperforming other European markets so far this year - were
among the worst hit, with HeidelbergCement down 2.6
percent, ThyssenKrupp down 2.3 percent and Roche
down 1.8 percent.
Zurich Insurance Group tumbled 3.9 percent after
the Swiss group posted a bigger-than-expected drop in quarterly
net profit after a blow to its German general insurance
"It's sort of a wake-up call: no country is immune, which in
a sense could be seen as a good news," a Paris-based trader
said. "With the crisis spreading to the Netherlands, Dutch and
German leaders might start to soften their positions on a lot of
issues related to the euro zone crisis, so we might get things
Bucking the trend on Thursday, Spain's IBEX added
0.3 percent and some euro zone banks rallied on revived
speculation that Spain might be ready to seek a bailout, a
condition for activating a European Central Bank bond-buying
Credit Agricole climbed 1.5 percent, Banco de
Sabadell added 1.3 percent and UniCredit
gained 0.7 percent.
However, "we're not getting any 'sell' signals, keeping in
mind that just a week ago a lot of indexes were testing year
highs. There's no panic," IG market analyst Jerome Vinerier
"Short sellers are still very reluctant to bet against
indexes, it's a big risk with central banks being so proactive.
The short sellers are rather looking for ideas on a
stock-by-stock level," he said.
Fears of a deadlock in talks in the U.S. Congress aimed at
avoiding a 'fiscal cliff' of automatic spending cuts and tax
hikes also rattled investors on Thursday.
But Xavier Lespinas, head of equities at Swiss Life Private
Bank, saw scope for gains if the U.S. deadlock is resolved and
Spain makes a move. "If we quickly get one of these two
triggers, markets can go up 5-10 percent in the short term," he
He also sees Washington's budget problems weighing on U.S.
stocks. "The arbitrage has already started, if you look at the
inflows and outflows on both sides of the Atlantic over the past
The FTSEurofirst 300 is down 3.9 percent since a high hit in
mid-September, while Wall Street's S&P 500 has lost 8.3
percent over the same period.
Recent data from EPFR Global have shown inflows into to
U.S.-domiciled Europe equity funds, while Europe-domiciled U.S.
equity funds have suffered record redemptions, signalling a
geographical rotation in asset allocation.