* FTSEurofirst 300 index closes down 0.1 pct
* Drugmakers fall; Sanofi-Aventis drug safety concerns
* Volkswagen gains possible Suzuki tie-up
By Joanne Frearson
LONDON, June 26 (Reuters) - European shares closed lower on
Friday as drugmakers fell, led by Sanofi-Aventis <SASY.PA>,
while commodities retreated on lower crude and metal prices.
The pan-European FTSEurofirst 300 <> index of top
shares closed down 0.1 percent at 844.59 points, having reached
as high as 856.74 earlier in the day.
"It's been a funny kind of day. The market started off well
and then slipped back. It is difficult to say what it is," said
Peter Dixon, strategist at Commerzbank.
"Over the course of the day sentiment has seemed to have
dissipated. I also think it is a bit of a reaction to the
negative day in the U.S. Investors just want to sell and take
profits," Dixon said.
Major U.S. indexes <> <.SPX> <> were down 0.1-0.6
percent.
Drugmakers took the most points off the index.
Sanofi-Aventis slipped 8.1 percent, extending the previous day's
losses, while Novo Nordisk <NOVOb.CO> fell 3.7 percent on
continuing concerns about the safety of Sanofi's diabetes drug
Lantus and modern insulins in general.
Energy stocks were lower as crude <CLc1> fell back 1.7
percent. BP <BP.L>, Royal Dutch Shell <RDSa.L> and Premier Oil
<PMO.L> slipped 0.2-2.1 percent.
Miners were in the doldrums as copper <MCU3=LX> retreated 1
percent. Anglo American <AAL.L>, BHP Billiton <BLT.L>, Eurasian
Natural Resources Corporation <ENRC.L> and Rio Tinto <RIO.L>
were down 0.7-2 percent.
The banking sector was mixed. UBS <UBSN.VX> fell 5.3 percent
after it said late Thursday it would raise $3.5 billion (3.8
billion Swiss francs) in new capital and post a second-quarter
loss. []
TECHNOLOGY GAINS
Other banks were higher. HSBC <HSBA.L>, Banco Santander
<SAN.MC>, Royal Bank of Scotland <RBS.L> and Deutsche Bank
<DBKGn.DE> were up 0.8-4 percent.
Technology stocks added the most to the index.
Shares in German chipmaker Infineon <IFXGn.DE> rose 1.6
percent after several brokers lifted their target prices after
the company raised its guidance for its third quarter.
Carmakers ticked up. Volkswagen <VOWG.DE> gained 2.9 percent
after a source familiar with the matter told Reuters on Thursday
that it is exploring a deal to cooperate with the Japanese
automaker Suzuki Motor <7269.T> to boost its presence in
ultra-small cars. []
"The ultra-small car segment is expected to grow
substantially through high demand in emerging markets such as
Index and potential demand in mega cities," said MM Warburg
analyst Marc-Rene Tonn.
Shares in Norway's Telenor <TEL.OL> jumped 4.7 percent after
a Russian newspaper reported it was close to agreeing with
Russian partner the Alfa Group on a merger of their Russian and
Ukrainian mobile telecom interests. []
In macro economic news, investors shrugged aside data that
showed U.S. consumer spending rose as expected in May while
personal income posted a larger than expected jump as consumers
spent government stimulus money. []
Meanwhile, U.S. consumer confidence rose in June to the
highest since February 2008, as expectations grew that the worst
economic recession since the Great Depression may be ending, a
survey showed. []
Across Europe, the FTSE 100 <> index was down 0.3
percent, Germany's DAX <> was 0.5 percent lower and
France's CAC 40 <> was down 1.1 percent.
(Editing by David Cowell)
