European shares fall

European shares ended lower on Tuesday, after hitting 11-week highs earlier in the day, on concerns that a European Union summit scheduled for Wednesday might not come up with a bold and comprehensive plan to tackle the region's debt crisis. Germany's Chancellor Angela Merkel opposed a phrase in a draft conclusion for the summit that calls for the European Central Bank to continue buying bonds in the secondary market.
While a meeting of EU finance ministers was cancelled as the details of issues to be discussed had not been finalised. Uncertainties remain over complex options to increase the firepower of the 440-billion-euro ($600 billion) European Financial Stability Facility so it can prevent contagion spreading from Greece to Italy and Spain. Sectors that suffer in a difficult economic environment were among the top losers, with the construction and materials index down 1.9 percent and European banks falling 1.1 percent.
The FTSEurofirst 300 index of top European shares provisionally finished 0.7 percent lower at 982.57 points after rising to a high of 993.29 earlier in the session. Across Europe, Italy's FTSE MIB, down 1.1 percent, underperformed the wider market as Italian Prime Minister Silvio Berlusconi's faction-ridden cabinet failed to agree at an emergency session on raising the retirement age, a key economic reform demanded by Italy's EU partners as a condition for supporting its bonds.
European shares climbed to an 11-week high earlier in the session on encouraging earnings results from companies such as BP and Deutsche Bank, but caution soon returned. BP ended 4.4 percent higher and Deutsche Bank gained 0.3 percent, but other key companies suffered sharp losses.
The earnings season so far has not provided any strong support to the market. Thomson Reuters StarMine data showed that of the 33 percent of European companies that have reported third-quarter results, 58 percent came in below expectations. The remaining 42 percent either beat or met estimates. Among individual movers, Novartis fell 3.3 percent. It is slashing 2,000 jobs in Switzerland and the United States to keep costs under control in the face of growing price pressures and the strong Swiss franc.