* FTSEurofirst 300 up 0.2 percent
* China comments lift miners
* HSBC rises on Ping An stake sale
* Weak Europe PMIs sees indexes pare gains
* Nokia rallies on China tie up
By David Brett
LONDON, Dec 5 European shares edged away from
2012 highs by midday on Wednesday, after weak services data in
Europe took some of the gloss off comments from China overnight
which had boosted optimism on growth.
By 1124 GMT, the FTSEurofirst 300 was up 1.81
points, or 0.2 percent, at 1,123.06, slipping away from the 2012
year high of 1,128.65.
Indexes began edging away from session highs shortly after
European services PMI data showed there were few signs the euro
zone region will emerge from recession any time soon, and the UK
service sector recovery had stalled.
The euro zone economy is forecast to grow by just 0.1
percent in 2013, according to Reuters polls.
The weak demand from Europe was also reflected in British
software company Sage Group's trading update.
The company, whose software is used by more than 6 million
small businesses to run payroll and accounts said tough
conditions for small businesses in France and Spain would drag
on growth in 2013.
Sage shares fell by 2.5 percent.
"It has been a lacklustre session and the PMI numbers gave
investors the opportunity to take some small gains out of the
market ahead of the Wall Street open," a London-based trader
Wall Street was expected to open around 0.3 percent higher
but gains remain capped with the deadlock in U.S. "fiscal cliff"
negotiations of some $600 billion of tax hikes and federal
spending cuts keeping investors in check.
"If the U.S. unexpectedly rallies, however, then there's
every chance we can break new 2012 highs but we need a fresh
catalyst," the trader said.
Volumes were just 32 percent of their already weak 90-day
daily average as investors begin to wind down for the Christmas
holidays, while the euro zone blue chip index, up
0.3 percent at 2,597, failed break through 2,598.
"The stoxx50e is trying to break the horizontal resistance
area of 2,605 and 2,610 and I believe it is possible to break
that this week," Roelof-Jan van den Akker, senior technical
analyst at ING Commercial Banking, said.
"If we see a close above 2,610 then that is an interesting
buy signal for a rally in the coming months towards the
horizontal resistance level around 3,000."
He said a failure to close above 2,610 this week could lead
to a minor retracement before the index resumes its attack on
Comments overnight from Chinese Communist Party chief Xi
Jinping who said the country will ensure stable economic growth,
spending cuts lifted commodity-related stocks with basic
resources up 1.8 percent.
Banks were higher too, led by heavyweight HSBC
up 0.9 percent has sold a stake in China's Ping An
Insurance for $9.38 billion.
In a note on European stocks, U.S. investment bank Citi
remained bullish on prospects for equities in Europe in 2013.
It recommended that investors choose companies with
defensive growth characteristics and which are seen as "world
champions" in their sector.
The world's No. 3 retailer Tesco climbed 2.9
percent after announcing it is set to end its five-year attempt
to crack the cut-throat U.S. grocery market and focus instead on
its struggling home business and faster-growing emerging
Struggling phone maker Nokia rallied 7.3 after
announcing it is to partner with China Mobile, the
world's biggest operator, to launch a version of its flagship
Lumia smartphone tailored for the world's largest market.