European shares weakened on Thursday in a broad-based sell-off after minutes of the U.S. Federal Reserve’s June meeting dampened hopes for more risk-asset-boosting stimulus in the near term. The Fed minutes showed the world’s biggest economy would have to worsen before the central bank eased monetary policy further. A few officials thought more stimulus was justified, but the majority were unconvinced. “With the Fed holding back on QE3 (a third round of quantitative easing), perhaps in anticipation of darker days ahead, the short sellers are coming out in force,” Mike McCudden, head of derivatives at Interactive Investor, said. “Thinning volumes as we trudge through the summer months will bring increased volatility in the markets and right now, the picture is looking pretty bleak.” The FTSEurofirst 300 was down 1.1 percent at 1,027.66 by 1057 GMT, in volume just 29 percent of the 90-day daily average. The index was trading below its 100-day moving average, a solid support which it breached earlier in the day. Consistent closes below that level at the end of April saw the index plunge 9 percent as euro zone debt and global growth worries intensified, although the 200-day moving average is on the rise, currently at 1,014. U.S. stock index futures pointed to a lower opening on Wall Street on Thursday, with futures for the S&P 500, the Nasdaq 100 and the Dow Jones down 0.7 to 0.9 percent, ahead of U.S. weekly jobless claims data at 1230 GMT. “There’s still a tug of war between weak macro — the most recent data we have seen in Europe and the U.S. has been poor —and hope for policy intervention,” Emmanuel Cau, strategist at JPMorgan, said. “The Fed minutes yesterday did not provide much clarity, in the sense that they kept the door open to intervention but we think there is a big question mark about timing.
