* FTSEurofirst 300 index falls 0.3 pct
* Spanish banks fall after Moody's puts Spain on review
* For up-to-the-minute market news, click on []
By Brian Gorman
LONDON, Dec 15 (Reuters) - European shares fell in early
trade on Wednesday after the U.S. Federal Reserve gave a
cautious assessment of the strength of the economic recovery,
and a ratings agency put Spain on review for a downgrade .
Spain's IBEX <> fell 1.7 percent after ratings agency
Moody's said it had put Spain on review for a possible downgrade
because of its high funding needs and doubts about its banking
sector and regional finances. []
Spanish banks Banco Santander <SAN.MC> and BBVA <BBVA.MC>
fell 2.9 and 2.5 percent, respectively.
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For a graphic showing Euro zone credit ratings and spreads:
http://r.reuters.com/get52k
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Other banks to fall included BNP Paribas <BNPP.PA>, Societe
Generale <SOGN.PA> and UniCredit <CRDI.MI>, down between 1.8 and
2.9 percent.
At 0941 GMT, the FTSEurofirst 300 <> index of top
European shares was 0.3 percent lower at 1,129.18 points, after
rising for seven straight sessions, its longest winning run in
six months, and hitting its highest close in nearly 27 months.
The Fed said the economic recovery was still too slow to
bring down unemployment and reaffirmed its commitment to buy
$600 billion in government bonds.
"The very first line of the very first paragraph is
justification for what (the Fed) it's doing -- it talks about a
recovery that just isn't strong enough to bring down the
unemployment rate," said Mike Lenhoff, chief strategist and head
of research at Brewin Dolphin Securities, in London.
Across Europe, Britain's FTSE 100 <>, Germany's DAX
<> and France's CAC40 <> fell between 0.3 and 0.6
percent.
"We've had a surprisingly strong run," said Lenhoff. "The
market may dither around for a while but the underlying
direction is really upwards. Markets have bought into the
reflationary story."
INDITEX FALLS
Spain's Inditex <ITX.MC>, the world's No.1 clothing
retailer, dropped 3.5 percent after signalled a slowdown in
recent underlying sales growth. []
Rival fashion group Hennes & Mauritz <HMb.ST> fell 1.5
percent after it said sales at its established stores rose 8
percent in November from a year earlier. []
Drugmaker Novartis <NOVN.VX> rose 4.2 percent after
clinching full ownership of eyecare group Alcon <ACL.N> thanks
to a sweetened deal. []
French information technology firm Atos Origin <ATOS.PA>
surged 12 percent after agreeing to buy Siemens' <SIEGn.DE> IT
unit Solutions and Services (SIS) in an 850 million euro deal.
Siemens rose 1.6 percent. []
In European macroeconomics, Sweden's central bank raised its
key interest rate a quarter point to 1.25 percent as expected on
Wednesday, the fourth such increase this year as it looks to
cool a record pace of economic growth.
While many European nations face years of austerity as
governments attempt to restore order to public finances, Sweden
has bounced back rapidly from last year's downturn.
[]
UK unemployment rose for the first time in six months in the
three months to October, official data showed. []
The European benchmark is up more than 5 percent in
December. This "could still be dismissed as a low-quality,
unsustainable low-volume squeeze," Evolution Securities says in
a note.
"Maybe, but this misses the improving economic confidence,
the awaited asset allocation shift from bonds to equities, and
the powerful seasonal story for European and UK equities out to
end-April."
A raft of data due later from the United States includes
measures of industrial output, the housing market and
manufacturing.
(Graphic by Scott Barber; Editing by Hans Peters)
