European shares dip as uncertainty over Greece lingers

LONDON: European shares slipped lower on Thursday, as lingering uncertainty over Greece's debt problems pegged back the region's stock markets.

European equities had rallied on Wednesday on reports of a staff-level agreement between Greece and its creditors but German Finance Minister Wolfgang Schaeuble later said there was not much progress in the talks.

Athens' benchmark ATG equity index was down 1.1 percent, underperforming a 0.3 percent fall on the broader, pan-European FTSEurofirst 300 index. The ATG is up around 2 percent since the start of 2015, less than an 18 percent gain on the FTSEurofirst 300.

Desperate to receive more funds before it runs out of cash, the government of Greek Prime Minister Alexis Tsipras has alternated between lashing out at the creditors, especially the International Monetary Fund, and declaring that a deal is just around the corner.

Most investors expect Greece to remain within the euro zone even if it misses some payments.

Record low interest rates and other economic stimulus measures from the European Central Bank have also enabled European stocks to rally this year, despite the Greek problems.

Nevertheless, traders said the lack of progress over Greece was making some investors wary.

"Overall sentiment remains neutral with markets likely to be confined to range-trading for most of the day as traders are remaining on the sidelines listening out for new developments where Greece is concerned," said Markus Huber, senior sales trader at Peregine & Black.

Mike Reuter, a trader at brokerage Tradition, also said the Greek stalemate could cause more stock market weakness on Friday.

However, European technology shares outperformed, boosted by takeover speculation after Reuters reported that Avago Technologies was close to an agreement to buy Broadcom Corp.

European chip-makers Infineon and STM rose 4.1 percent and 2.9 percent, respectively.