European stocks took a dip on Friday, pulled lower by drugs, telecom and mining stocks, as merger activity continued to bubble away and investors digested the latest batch of corporate earnings, according to Reuters. Among major movers, Spanish builder Sacyr Vallehermoso jumped on earnings optimism and the prospect of a higher Repsol stake, while Hermes International tumbled after its quarterly results. The pan-European FTSEurofirst index of 300 leading shares ended unofficially down 0.3 percent at 1,463.24 points, but remains just shy of its highest level since May 2001 reached on Thursday. "Sentiment is pretty strong. There's so much liquidity around and no one's got any alternative ideas -- cash, bonds etc, don't offer much value," said Andrea Williams, head of European equities at Royal London Asset Management. "Equities do, there is just a wall of money around and its quite difficult to fight against it." Across Europe, Germany's DAX and France's CAC 40 ticked up 0.1 percent, while the FTSE 100 was down 0.4 percent. Drug stocks weighed on the market, with GlaxoSmithKline down 1.9 percent, AstraZeneca 2.1 percent lower and Shire down 2.9 percent on long-term worries after the U.S. mid-term elections that the U.S. government could intervene in pricing drugs. "The view is that for the next little while, that will be a headwind to drug companies in the U.S. It's a sentiment thing," said Stephen Dowds, head of international equities at Northern Trust. "I am not sure it's quite simple as that, but clearly that's what is happening and that's why the reaction has been the way it is." Mining stocks slipped, with Antofagasta down 5 percent, while Rio Tinto fell 2.8 percent and BHP Billiton 2.6 percent after copper fell to four-month lows on the London Metal Exchange as reported stocks rose. Also weighing on European markets were telecom shares, led by Europe's biggest telecoms group, Deutsche Telekom, as investors shrugged off its slightly better-than-expected results and focused on its uninspiring forecasts. "The overall results (of European telecom companies) were not that great," a Frankfurt-based analyst said. "It shows that the big telecom firms are still struggling," he added. Among companies posting results, Italy's biggest power utility Enel added 2 percent after posting a rise in quarterly profit, while Spain's Sacyr rallied 6.4 percent on optimism for its earnings and a higher Repsol stake. Luxury goods maker Hermes was sold down 4.7 percent after a weak yen took its toll on reported sales in Japan. In bid stories, South African miner Lonmin pushed up 3 percent after a broker upgrade and as unspecified bid speculation swirled.
