European shares were mostly lower on Monday, falling for a third day as miners suffered from weaker metals prices, although Germany gained after an election result which was regarded by analysts as helpful for business.
At 1042 GMT the FTSEurofirst 300 index of top European shares was down 0.3 percent at 981.43 points, having earlier fallen as low as 974.85, a three-week low.
But the index is up 52 percent from its lifetime low of March 9, as investors have become more confident about the prospects of recovery.
"We're just seeing a bit of a pull-back after the very strong run-up," said Andy Lynch, fund manager at Schroders. "Markets don't go up in a straight line forever. There's nothing to read into it."
Miners were among top losers, with metals prices falling on demand concerns and a strengthening dollar, which makes commodities costlier for holders of other currencies.
BHP Billiton, Anglo American, Antofagasta, Rio Tinto and Xstrata fell 0.8-2.5 percent.
Financial shares also came under pressure.
BNP Paribas, Banco Santander, Credit Suisse, UBS and UniCredit were down between 1.2 and 1.5 percent.
Lloyds Banking Group and Royal Bank of Scotland shed 2.6 percent and 2.8 percent, respectively, hit by worries over mooted rights issues and weekend comments by British Prime Minister Gordon Brown on curbing bank bonuses.
Germany's stockmarket was the strongest performer, with the DAX up 0.7 percent after Sunday's election provided a result that commentators said was helpful to business.
Chancellor Angela Merkel's conservatives vowed on Monday to seal a coalition deal, including tax cuts, with the pro-business Free Democrats (FDP) within a month after winning Germany's election.
Merkel's conservatives won a parliamentary majority on Sunday with the FDP, her partner of choice, enabling her to end her awkward four-year-old partnership with the Social Democrats.
"(This) government provides the greatest opportunities for equity market-friendly reforms compared to other party combinations," said Tammo Greetfeld, equity strategist at UniCredit in a note.
GERMAN UTILITIES GAIN
Shares in nuclear plant operators E.ON and RWE were up by 3.4 and 3.1 percent respectively, driven by hopes that the German government will reverse a law to close atomic power plants by 2020. Solar power stocks fell on fears of lower subsidies. Q-Cells fell 3.5 percent.
Across Europe, Britain's FTSE 100 index fell 0.2 percent and France's CAC 40 fell 0.3 percent.
GlaxoSmithKline rose 1.2 percent after the Financial Times said the company has sealed a 1.5 billion euro (1.38 billion pound) deal with Brazil, guaranteeing sales of its pneumococcal vaccine over the entire life of the product.
Belgian drugs, chemicals and plastics maker Solvay was down 1.8 percent in line with broader market trends. It said on Monday it would sell its drugs unit to U.S. partner Abbott Laboratories for 4.5 billion euros ($6.6 billion) in cash and reinvest in chemicals and plastics.
British building supplies company Wolseley rose 9.6 percent after reporting a full-year profit that beat analysts' expectations.
The results prompted Deutsche Bank to upgrade its rating on the shares to "buy" from "hold". Wolseley is up more than 150 percent from its March low.
Ahead of Wall Street opening, U.S. stock index futures for the Dow Jones, S&P 500 and Nasdaq were marginally higher, up between 0.1 and 0.3 percent.
Economic data due this week include U.S. PMI prices and non-farm payrolls data, and German unemployment numbers.
