LONDON, Sept 26 (Reuters) - European shares fell on Wednesday as positivity around recent central bank stimulus continued to fade in the face of concerns about growth and earnings, leaving a leading index stuck in its sideways range.
By 0704 GMT, the FTSEurofirst 300 had shed 8.81 points, or 0.8 percent, to 1,110.98, having risen 0.4 percent on Tuesday, buoyed late on by bullish macro economic data on Wall Street. That sentiment had soured by the U.S. close, however.
Traders cited weak corporate results, quarter-end profit taking and doubts over the effectiveness of the Fed’s latest monetary stimulus as the S&P 500 suffered its worst day since June on Tuesday.
“If you are in the QE [quantitative easing] camp and were hoping for a sweet ride until the end of the year then this has been disappointing,” Steen Jakobsen, strategist at Saxo Bank, said.
“We are in the ‘blow off’ phase. Many stocks are still great stocks but they are overvalued relative to the incoming economic situation,” he said.
The FTSEurofirst has traded in a tight 20 point range since the United States announced further stimulus measures in early September as the index paused after nearly 18 percent gains since early June.
The rally was accompanied by low volumes, a result of the overall cautious sentiment among investors.
That was reflected by the London Stock Exchange and broker ICAP on Wednesday, after both reported big falls in trading over the summer, leaving them reliant on other sources of revenue to sustain profits.
LSE shed 2.1 percent, while ICAP fell 4.8 percent.