* FTSEurofirst 300 falls 0.9 percent
* Financial, commodity shares retreat
* Retailers gain ground
By Atul Prakash
LONDON, June 3 (Reuters) - European shares slipped in early
trade on Wednesday after hitting a five-month high in the
previous session, with the banking sector extending Tuesday's
losses and commodity shares retreating.
At 0831 GMT, the FTSEurofirst 300 <> index of top
European shares was down 0.6 percent at 880.29 points after
falling as low as 876.05. The index, which slumped 45 percent in
2008, has jumped 37 percent since falling to a lifetime low in
early March.
Banks <.SX7P>, which have more than doubled since early
March, were among the biggest decliners. Barclays <BARC.L>,
Standard Chartered <STAN.L>, HSBC <HSBA.L>, Lloyds <LLOY.L> and
Societe Generale <SOGN.PA> fell 2.6-5.1 percent.
Commodity shares also declined as investors took profits
from their recent sharp gains on the back of firmer crude oil
and metals prices, traders said.
Tullow Oil <TLW.L>, BP <BP.L>, Royal Dutch Shell <RDSb.L>,
BG Group <BG.L>, Repsol <REP.MC>, Total <TOTF.PA> and
StatoilHydro <STL.OL> shed between 0.2 and 3.5 percent.
But analysts remained positive and said the market was
expected to gain in the second half of the year.
"It will not be a one straight line and there can be
intermediate corrections, but the corrections should be rather
limited in size as well in duration," said Luc Van Hecka, chief
economist at KBC Securities.
"Certainly, the probability of a long, deep recession has
receded considerably over the past couple of weeks. The idea
that interest rates are expected to remain low should further
support the market," he added.
Britain's economy could return to growth in the second
quarter of this year, the compiler of the closely-watched
purchasing managers' indices said, after its all-sector reading
indicated overall growth in May. []
Investors awaited U.S. ADP employment and factory orders
data for more insight on the economic outlook, a day after
upbeat housing data in the United States fuelled further
recovery hopes.
Across Europe, the FTSE 100 index <>, Germany's DAX
<> and France's CAC 40 <> were 0.6-1.6 percent lower.
MINERS SLIP
Miners also lost ground. BHP Billiton <BLT.L>, Anglo
American <AAL.L>, Antofagasta <ANTO.L>, Rio Tinto <RIO.L>,
Xstrata <STA.L> and Eurasian Natural Resources <ENRC.L> fell
0.1-3.8 percent.
Bouygues <BOUY.PA> fell more than 5 percent after it posted
a 55 percent fall in first-quarter operating profit, lagging
analyst estimates, and cut its 2009 sales forecast to reflect a
change in outlook for its TV channel and lower orders for its
construction unit.
Shares in Salzgitter <SZGG.DE>, Germany's second-largest
steelmaker, fell 4.8 percent after UBS downgraded the company to
"sell" from "neutral.
Lloyd's of London insurer Amlin <AML.L> said it had agreed
to buy Fortis Corporate Insurance, a provider of corporate
property and casualty insurance, from the Dutch government for
350 million euros ($497.5 million). Its shares fell 5.9 percent.
Retailers were on the positive side. Morrison <MRW.L>,
Sainsbury <SBRY.L>, Tesco <TSCO.L> and Carrefour <CAPR.PA> rose
0.2-1.3 percent.
(Editing by Jon Loades-Carter)
