Business

Wed Jun 18 01:16:57 PDT 2008

LONDON, June 18 (Reuters) – European stocks fell early on Wednesday as concerns over banks persisted ahead of results from Morgan Stanley, while shares in oil groups tracked the price of crude lower.

By 0721 GMT the FTSEurofirst 300 index of top European shares was down 0.3 percent at 1,264.60.

Credit Suisse fell 0.7 percent, Lloyds TSB lost 1.4 percent and Dexia slipped 1 percent.

British supermarket group J. Sainsbury shed 2 percent after first-quarter underlying sales came in at the lower end of analysts’ expectations

But Swedish retailer Hennes & Mauritz jumped 6.6 percent to top European gainers after its second-quarter earnings and May sales beat expectations.

"Sainsbury’s update shows how competitive the environment is out there, with consumers having less money in their pockets due to higher mortgage payments, higher taxes and higher prices at the pump," said Barclays strategist Henk Potts.

Oil stocks fell, with BP, Total and Shell losing 0.3-0.6 percent as crude traded 45 cents lower at $133.61 a barrel.

On Tuesday, Goldman Sachs warned U.S. banks would have to raise as much as $65 billion in capital to shore up balance sheets and that the global credit crisis will not peak until 2009.

(Reporting by Patrizia Kokot)

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