European shares close down 0.1%

European shares edged lower yesterday, retreating from a 15-month high earlier in the session, as financial shares slipped ahead of the start of the US earnings season.

The pan-European FTSEurofirst 300 index of top shares closed down 0.1 per cent at 1,063.82 points, after touching a new 15-month high of 1,074.50.

Across Europe, the FTSE 100 index and Germany's DAX were up 0.1 per cent and France's CAC 40 was down 0.1 per cent.

"The Chinese numbers were great which is why we were so strong first thing this morning, but now we have seen the profit takers come out," said Jim Wood Smith, head of research at Williams de Broe.

"We have got a lot of data coming out over the next few weeks and the fourth-quarter earnings season in the United States is about to start, so there is every reason for investors to stay on the sidelines."

China's exports leapt 17.7 per cent from a year earlier, dwarfing the four per cent rise forecast by economists and breaking a 13-month streak of year-on-year declines. Imports surged 55.9 per cent, much more than the 31 per cent increase markets had expected.

In the United States, aluminium producer Alcoa will kick start the beginning of the fourth-quarter earnings season, with numbers due after the market close. Later in the week, banking giant JP Morgan and chipmaker Intel will report figures.

Banking stocks featured among the worst performers. Deutsche Bank fell 1.2 per cent after traders pointed to speculation that it could cut its dividend. The company declined to comment.

Credit Suisse, BNP Paribas and UBS were down 1 to 2.1 per cent.

Mining stocks retreated from earlier gains. Chile's mining minister Santiago Gonzalez said global copper prices could see an "important" downward correction as high metal inventories continue to climb.

Anglo American, Antofagasta, BHP Billiton, Eurasian Natural Resources Corporation, Rio Tinto and Xstrata were down 0.4 to 2.3 per cent.

However, energy stocks were among the biggest risers, lifted by the upbeat trade data from China.

BG Group, BP, Royal Dutch Shell and Total were 0.3 to 2.4 per cent higher.

"China is one of the biggest exporters in the world and they will play a very strong hand in the global economic recovery. That is why this news has been received very well by investors," said Joshua Raymond, market analyst at City Index.

Heineken gained 3.3 per cent after it said it would buy the beer business of Mexico's FEMSA in a deal that will boost the Dutch brewer's emerging-market presence.