European shares surrendered most of their early gains on Wednesday, with cyclical shares losing ground, as expectations grew that this week's European Union summit will not deliver bold steps to resolve the long-running euro zone crisis.

Investors remained jittery as differences between leaders persisted ahead of the June 28-29 summit, with German Chancellor Angela Merkel saying on Tuesday that Europe would not share total debt liabilities “as long as I live”.

European Council President Herman Van Rompuy had earlier released a report on closer fiscal and banking union envisaging a euro zone treasury that would issue common debt in the medium term.

Uncertainty about the meeting prompted some investors to position themselves to protect from possible losses.

“If you are short and you have made some money, you do not want to run the risk of some positive outcome from the summit. That explains why sentiment is slightly positive today,” Philippe Gijsels, head of research at BNP Paribas Fortis Global Markets, said.

“Although, clearly there is room for disappointment. If they come up with nothing, we are going to see a rocky summer.”

At 10:38 SA time, the FTSEurofirst 300 index of top European shares was up 0.1 percent at 988.03 points after rising as high as 992.79 earlier in the day. It ended flat in the previous day and falling in the past three straight sessions on caution ahead of the summit.

Cyclical stocks were under pressure, with miners falling 1.1 percent and chemical shares down 0.7 percent.

“The EU summit may well set the tone for the summer months if we get a big surprise in either direction. I don't feel expectations are particularly high going into it, which should limit the downside if the summit were to disappoint,” Robert Parkes, equity strategist at HSBC Securities, said.

Some analysts said investors would like to see a road map and some consensus between Germany and others countries. That, along with a possible liquidity injection by central banks, would be seen as positive for the market, which could rise 3 to 5 percent in a short span of time.

Among individual movers, Colruyt was up 7.5 percent after rising to an eight-month high as the Belgian supermarket chain reported a rise in full-year net profit, against expectations of a decline. - Reuters