Europe's Markets Close Lower Wednesday on EU Summit Concerns

European shares slipped back slightly in cautious trade on Wednesday, ahead of a EU summit this week, amid uncertainty about the chances a comprehensive deal would be reached to help end the region's debt crisis.

London's FTSE fell 22 points to 5,547, Germany's DAX declined 34 points to 5,995, and France's CAC 40 dipped 4 points to 3,176.

A senior German official gave a downbeat assessment of prospects for an agreement, in an apparent effort to jolt partners into accepting Berlin's terms and restrictions, although the French finance minister was more optimistic.

If they (European leaders) just say we're going to have some budget limits, but no one is going to enforce them, the market is going to react to that negatively, said Bob Parker, senior adviser at Credit Suisse.

We've had a very strong rally. Markets are pricing in a lot of good news.

The FTSEurofirst 300 index of top European shares fell 0.1 percent to a provisional close of 988.41 points, after earlier hitting 1,002.20, its highest level since late October.

Stocks fell in most sectors, with financials among the biggest losers. Dutch insurer and banking group ING fell 4.8 percent after saying it would take a charge of up to 1.1 billion euros on a U.S. insurance portfolio.