European shares held near multi-year highs today, with the region’s main stock markets supported by prospects of new economic stimulus next week from the European Central Bank.

Utility stocks underperformed after Citigroup cut its ratings on some southern European stocks in the sector, such as Enel. Regulatory pressures and increasing competition could affect the companies’ earnings, the bank said.

Citigroup’s downgrades led to a 0.2 per cent decline by the STOXX Europe 600 Utilities Index, compared with a flat performance on the broader STOXX 600 index.

The utilities index has risen about 13 percent since the start of 2014, making it one of the top-performing sectors. The pan-European FTSEurofirst 300 index was also flat at 1,378.02 points, still close a point near a six-year high of 1,380.52 points that it reached this week.

Germany’s DAX slipped 0.1 per cent to 9,925.20 points after rising to a record high of 9,957.87 points yesterday. France’s CAC fell 0.2 per cent to 4,524.82 points. “The trend is up, the trend’s your friend, but I wouldn’t buy up at these levels,” said Darren Courtney-Cook, head of trading at Central Markets Investment Management.

He said that he would prefer to wait for pullbacks before buying DAX futures . Expectations that European Central Bank head Mario Draghi will cut interest rates or introduce other monetary policy measures next week to help Europe’s economy have enabled the region’s stock markets to maintain a broad, upwards trajectory since the start of 2014.

The FTSEurofirst 300 is up by about 5 per cent since the start of 2014, while the DAX and CAC have risen by about 4-5 per cent. Naeem Aslam, Ava Trade’s chief market analyst, said the majority of investors were still buying equities on expectations of ECB move, but he warned that the outcome of the bank’s meeting may not be as clear-cut as some think.

“The optimism is just on the back of the hopes that the ECB is ready to take action to fight deflation and boost the economy, and traders are waiting for Mr Draghi to open the gates for further easing of monetary policy,” Mr Aslam said. “But make no mistake, this is not going to be as easy as many are thinking,” he said, referring to opposition to cutting rates that Draghi could face in some quarters of the ECB.

Reuters