European stocks end flat as telecoms offset cars

By Blaise Robinson

PARIS, Feb 13 (Reuters) - European stocks ended flat on Wednesday, pausing after the previous session's sharp rally as weak telecoms and mining shares offset rises in auto stocks which reported solid results.

Telefonica (TEF.MC: Quote, Profile, Research) fell 1.8 percent, hit by worries over the prospect of greater competition in Spain, while Vodafone (VOD.L: Quote, Profile, Research) lost 1.7 percent.

The FTSEurofirst 300 index of top European shares closed unchanged, at 1,334.25 points. The index gained as much as 0.6 percent in afternoon trading following better-than-expected monthly U.S. retail sales.

"It is tempting to call the bottom of the market, but the economic scenario is far from clear," said Arthur van Slooten, strategist at Societe Generale, in Paris.

Data showed sales at U.S. retailers rose 0.3 percent in January, an unexpected pickup that follows a 0.4 percent decline in December, and was contrary to Wall Street analysts' forecasts for a 0.2 percent decline.

"U.S. Jan retail sales headlines were marginally better than expected, but I doubt this is going to change the broader view that consumer spending is decelerating and that the consumer remains very vulnerable to negative shocks going forward," Alan Ruskin, chief international strategist at RBS Greenwich Capital, wrote in a note.

Banks ended mixed, with Commerzbank (CBKG.DE: Quote, Profile, Research) up 4.1 percent and Banco Santander (SAN.MC: Quote, Profile, Research) up 0.8 percent, while Royal Bank of Scotland (RBS.L: Quote, Profile, Research) fell 1.3 percent and Barclays (BARC.L: Quote, Profile, Research) lost 0.4 percent.

Bradford & Bingley BB.L tumbled 23 percent after the specialist mortgage lender took a larger-than-expected writedown on its exposure to tarnished assets, while Alliance & Leicester (ALLL.L: Quote, Profile, Research) sank 7 percent on writedown fears.