European shares were lower around midday on Monday, as Hungary's debt crisis added to existing worries about the euro zone, though losses were pared after the release of better-than-expected German manufacturing data.
At 1106 GMT, the pan-European FTSEurofirst 300 <.FTEU3> index of top shares was down 0.2 percent at 996.50 points, off the day's low of 982.19 but still down over 10 percent from a mid-April peak on concern about the euro zone debt crisis.
"All the problems with sovereign debt are resurfacing," said Philippe Gijsels, head of research at BNP Paribas Fortis Global Markets in Brussels.
Markets tumbled on Friday after Hungary said it could suffer a Greece-style debt crisis, although the chairman of the Eurogroup of euro zone finance ministers, Jean-Claude Juncker, on Sunday dismissed those concerns and said the current level of the euro did not worry him. [ID:nLDE65602W]
"In Hungary it's an example of political manoeuvring, with the new government blaming the old one, but that's a dangerous game, if you imply you can't repay debt," added Gijsels.
"More and more countries are joining the club. There's too much debt, and no credible way of getting rid of it. Sometimes it seems there's a solution, and markets rally, but then you realise there's no solution, and they go back down. And there's no unity in the ECB," he said.
Analysts also pointed to worries about the strength of the recovery in the United States, following disappointing labour market data on Friday, which saw Wall Street drop to its lowest close since February.
In Europe, telecoms were lower. Greek telecom group OTE <OTEr.AT> fell 8.6 percent after saying in a bourse filing on Monday it would propose a dividend per share of 0.19 euros to the annual shareholders meeting on June 16, down from an initial proposal of 0.50 euros set on Feb. 25.
Vodafone <VOD.L>, one of the few shares to rise on Friday, fell 1.4 percent.
But most banking stocks were higher, having earlier extended Friday's losses.
Banco Santander <SAN.MC>, HSBC <HSBA.L>, Societe Generale <SOGN.PA> and UniCredit <CRDI.MI> all rose between 0.7 and 1.5 percent.
Across Europe, the FTSE 100 <.FTSE> index was down 0.3 percent, Germany's DAX <.GDAXI> slipped 0.1 percent and France's CAC 40 <.FCHI> was down 0.3 percent.
Spain's IBEX <.IBEX> and Italy's benchmark <.FTMIB> were flat; Portugal's PSI 20 <.PSI20> was up 0.1 percent.
GERMAN MACRO BOOST
Shares in the FTSEurofirst 300 recovered from early morning lows after data showed German manufacturing orders rose 2.8 percent on the month in April, beating forecasts and adding to signs Europe's largest economy is on the path to durable growth. Among individual shares, index heavyweight BP <BP.L> gained 2.6 percent after saying it expected a second oil containment system would allow it to increase the amount of oil being captured from its Gulf of Mexico spill. [ID:nN07147206]
Also on the upside, Adidas <ADSG.DE> gained 2.7 percent after Deutsche Bank upgraded the sporting goods maker to "buy" from "hold", saying it would benefit from the weaker euro.
The single currency picked up only slightly from a four-year low against the dollar on Monday.
Spain's Grifols <GRLS.MC> fell 5.3 percent after saying it would buy U.S.-based Talecris Biotherapeutics <TLCR.O>, which makes plasma-based protein therapies, for $3.4 billion in a bold move to expand its business in blood products.
