European shares inching downward (Reuters) (11-03-2010)

LONDON, March 11 (Reuters) - European shares were slightly lower at midday on Thursday, with miners weak on fears of policy tightening in China, while Volkswagen led carmakers higher.

Miners tracked weaker commodity prices as investors fretted about the prospect of monetary tightening in top consumer China where consumer inflation rose to a 16-month high in February.

Volkswagen was a big gainer, up 3.6 percent, as it affirmed 2010 guidance for higher revenue. Traders said investors were covering short positions after the company said it may not issue as many as 135 million new preferred shares in the first half. Fiat, Peugeot Porsche and Renault also rose.

Insurer Old Mutual lost 2.4 percent after saying it planned to sell its life business and partly float its asset management operation in the United States as part of a strategic shake-up aimed at simplifying its structure.

On the upside, Thomas Cook gained 2.6 percent as investors reacted positively to Wednesday's strategy presentation by the tour operator during which it set a target of increasing its operating margin to 5.5-6.0 percent in the next 3-5 years.

Across Europe, Britain's FTSE 100 shed 0.2 percent, Germany's DAX gained 0.1 percent and France's CAC 40 was 0.2 percent lower.

Banks came under pressure, with the likes of Barclays, Banco Santander, Societe Generale and UBS losing between 0.2-1.7 percent, while HSBC lost 0.8 percent as the bank issued a statement saying that the theft of data by a former employee affected about 15,000 Swiss client accounts, rather than the earlier statement of "less than 10 clients".

Source: Reuters