European stocks steady as they wait on ECB decision
European stocks steadied today, putting a halt to the previous session's tentative rebound.
Investors are waited to see if the ECB will signal a change in policy to support the creaking Eurozone economy.
The market was also hesitant following yesterday's low-volume technical bounce and ahead of US president Barack Obama's speech to Congress.
He is expected to propose $300 billion in tax cuts and government spending as part of a job-creating plan.
At 8.08am, the FTSEurofirst 300 index of top European shares was down 0.1 per cent at 930.79 points, after gaining 3 per cent yesterday recovering from a two-year closing low hit earlier in the week.
"We've reached extremely gloomy valuation levels on equities, with price-to-earnings ratios and dividend yields at levels not seen in the past 25 years, except during the 2008-2009 crisis," said Regis Begue, head of equities at Lazard Freres Gestion.
"A bank like BNP Paribas trades at four times expected earnings for 2012, while in our worst-case scenario for next year, we get a price-to-earnings ratio of 7-8.
‘’At these levels, European stocks are pricing in the breakup of the euro zone."
· The Irish index of shares was 0.2 per cent lower at 2513.96. Banking stocks fell, with AIB down 2 .2 per cent to 4.3 cent and Bank of Ireland 1.2 per cent to 8 cent.