European shares post modest early gains

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European shares post modest early gains

Europe's shares posted modest gains on Wednesday, clawing back some of the steep losses seen in the previous session, led higher by beaten down banks and mining stocks.

The FTSEurofirst 300 index was up 4.32 points, or 0.4 per cent, at 1,030.47 by 0720 GMT, having slid 2.5 per cent on Tuesday to its lowest close since mid-January.

The index has fallen around 7 per cent since hitting an eight-month high in March and is up just 2.9 per cent this year.

Market sentiment was dealt a sharp blow on Tuesday when Spain's funding problems returned to the fore, adding to jitters about the global economy in the aftermath of Friday's hugely disappointing employment report.

"Given the strong first quarter we always thought that there was the potential for a correction to come through. We've certainly seen that played out in the past couple of weeks," Henk Potts, equity strategist at Barclays Wealth, said.

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"But we still believe there's an opportunity for investors to take advantage of any further weakness that we see to buy in at a cheaper level to increase exposure to harness the medium to long term outperformance that we expect from equities."

Reuters

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