European shares slipped on Wednesday, with investors uneasy over how euro zone ministerial meetings on Greece's debt crisis will pan out, while a fall in UniCredit weighed on bank stocks. Greek Finance Minister Yanis Varoufakis headed for a showdown with euro zone finance ministers after his new leftist-led government won a parliamentary confidence vote for its refusal to extend an international bailout.
National Bank of Greece dropped 9.1 percent and Bank of Piraeus shed 3.2 percent, dragging Athens' benchmark ATG equity index 4 percent lower following an 8 percent rise on Tuesday. Europe's FTSEurofirst 300 index closed down by 0.3 percent at 1,483.69 points. Banking stocks were also affected by UniCredit, whose shares fell even though it met its full-year profit target as investors focused on a slight weakening in its core capital.
"The big disappointment majors on capital," said Jefferies equity analyst Joseph Dickerson, commenting on UniCredit. Dutch bank ING Group advanced 3.7 percent after saying it will resume paying a dividend in 2015 after a seven-year gap, while Norwegian fertiliser maker Yara rose 5.1 percent after posting higher profits and announcing a dividend increase. Europe's earning season has been mostly positive so far. About a third of STOXX 600 index companies have reported results, of which 61 percent have met or beaten analyst forecasts, according to Thomson Reuters StarMine data.
Jean-Louis Cussac, head of Perceval Finance, said the lack of clarity over how the Greek situation would unravel was causing some investors to hesitate over buying European shares. Nevertheless, Cussac and other traders said the underlying backdrop remained relatively positive, given the European Central Bank's planned quantitative easing programme of government bond purchases to boost the region's economy. "The sabre-rattling is going on, but the market does not appear too concerned about the Greek situation for now," said Andreas Clenow, hedge fund trader at ACIES Asset Management. "It's hard to say why the market is not reacting more negatively, but while the political situation is messy, the economic and financial situation appears to be under control."
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