* FTSEurofirst 300 index flat with downward bias * Pharma, telecom benefit from switch into defensives * Mining and energy lose shine
By Peter Starck
FRANKFURT, June 12 (Reuters) - European shares were little changed at midday on Friday, with robust gains for defensives such as pharma and telecom offset by slides in cyclical stocks, notably mining and energy.
By 1100 GMT, the pan-European FTSEurofirst 300 was down 0.04 percent at 887.41 points. The benchmark has risen around 37 percent since hitting a low in early March.
Pharmaceuticals contributed the most points to the index, sector shares rising on a broad front in what Postbank equity strategist Heinz-Gerd Sonnenschein saw as a rotation into defensives out of recently outperforming cyclical stocks.
Flu vaccine makers such as Novartis and Sanofi Aventis were also lifted by news that the World Health Organization (WHO) declared an influenza pandemic.
"It is a little bit of that (the WHO declaring a pandemic) but more a shift towards defensives away from stocks sensitive to economic growth," Sonnenschein said.
"Investors are looking for defensives after the strong run-up we have seen in the stock markets in recent months," he said.
The DJ Stoxx health care index, up 2.8 percent, was the top sectoral gainer, with GlaxoSmithKline up 4.1 percent, Novartis rising 4.2 percent, AstraZeneca adding 3.8 percent and Sanofi Aventis trading 3.4 percent higher.
Telecom, another traditional defensive safe-haven, was the next best sector, up 1.3 percent. Deutsche Telekom was up 2.2 percent, Vodafone rose 1.7 percent and Telefonica put on 1.0 percent.
Lower copper and oil prices brought to an end a recent rally in basic resources and oil and gas stocks.
Miners BHP Billiton, Rio Tinto and Anglo American were down by between 1.7 percent and 2.4 percent.
Vedanta Resources dropped 6.7 percent due to expected dilution from the group's $1.0 billion convertible bond issue.
OIL PRICE RISK
Among Europe's top oil companies, Total fell 1.7 percent, ENI lost 1.7 percent and BP dropped 1.4 percent. The crude oil price fell almost 1.5 percent.
"The risk of a massive price correction in the medium term is building up," Commerzbank said in a note on oil prices.
Economic data showed industrial production (IP) falling by a worse-than-expected 21.6 percent year-on-year in the 16-nation euro zone in April.
"Today's outcome is disappointing mostly because it shows that IP data are still lagging well behind survey indications," UniCredit said in a note.
LandesBank Berlin (LBB) said: "The risk is quite high that economic developments will not be able to keep pace with the ambitious expectations."
"After the over 40 percent rise in share prices since early March, further upside potential is limited," LBB said in a strategy note.
Also among Friday's European blue-chip losers, British bank Barclays was down 2.7 percent after it agreed to sell its investment arm, BGI, to BlackRock for $13.5 billion.
"The weakness today for the Barclays share price seems a case of 'buy the rumour, sell the news' -- the shares had rallied by almost 20 percent over the past week or so," IG Index said in a note.
Shares in other big European banks were little changed after Deutsche Bank said most European banks would pass a "stress test".
Across Europe, the FTSE 100 index was down 0.1 percent, Germany's DAX was down 0.3 percent and the French CAC 40 dipped 0.02 percent.
The Reuters/University of Michigan Surveys of Consumer sentiment is due for release at 1355 GMT. Economists in a Reuters survey expect a reading of 69.5, up from 68.7 in the final May report. The data was "likely to provide some final direction ahead of Europe closing for the week," CMC Markets said in a note. (Additional reporting by Joanne Frearson in London; Editing by Rupert Winchester)