European share prices were mostly lower by midday on Thursday amidst concerns over a potential downgrade of Greece's credit rating and oil majors and miners weakened by a firmer dollar, although banks made some gains following corporate results. By 1153 GMT, the pan-European FTSEurofirst 300 index of top shares fell 0.3 percent to 1,010.92 points.
Credit rating agency Standard & Poor's said on Wednesday it may downgrade Greece's BBB-plus rating by one or two notches within a month. Rival Moody's Investors Service said Greece would need to enact its fiscal reform plans as promised if it was to avoid a downgrade.
The dollar strengthened against the euro as persistent worries over Greece's fiscal situation hurt the single currency, with commodity prices falling as the dollar firmed.
Oil majors fell, as crude prices slipped to below $80 a barrel, with BP, BG, Royal Dutch Shell, Total and ENI off 0.3 to 1.2 percent.
"There are some worries over Greece which is putting pressure on the euro and hurting commodity prices. These potential ratings downgrades … are injecting a bit of volatility into the market and causing some concerns," said Nick Serff, market strategist at City Index.
On the upside, RBS rose 6.3 percent after its operating loss shrank to 6.2 billion pounds ($9.5 billion) loss, the largest in Europe for 2009. But the bank said impairments had peaked and signalled a "cautiously encouraging" outlook and improvements at its investment bank
France's biggest retail bank Credit Agricole reported a lower-than-expected fourth-quarter profit as earnings were hit by losses in Greece, but it also said it made a good start to 2010, helping its shares 3.6 percent higher.
Within the sector, HSBC, Societe Generale, Credit Suisse and Lloyds Banking Group added 0.1 to 3.4 percent.
Mining companies were lower, as weaker metals prices weighed on the sector. Anglo American, Eurasian Natural Resources, Kazakhmys, BHP Billiton, Xstrata and Rio Tinto off 0.5 to 2 percent.
Across Europe, Britain's FTSE 100, France's CAC 40 and Germany's DAX were 0.1 to 0.3 percent lower.
SAFRAN GAINS
Safran climbed 9.2 after the French aerospace group posts higher-than-expected 2009 operating profit and predicted moderate further gains this year.
Among other risers, BASF rose 4.5 percent after the chemicals group beat estimates. It forecast considerable operating profit gains this year amid a shaky recovery on higher chemicals and plastics sales volumes.
On the downside, Tenaris fell 5.6 percent as the top global producer of seamless steel pipes for the energy industry, said late on Wednesday its fourth-quarter net profit rose 110 percent to $240.8 million, below market expectations.
On the macroeconomic front, euro zone economic sentiment eased marginally in February against January, defying market expectations of a small rise as more pessimism among households and in the retail sector offset gains in industry and services.
German unemployment rose less sharply than expected in February, boosting hopes that government efforts to encourage part-time work have minimised the impact of a harsh winter on jobless levels.
Weekly U.S. jobless data is due at 1330 GMT.
