* Eurofirst 300 index down 0.7 pct, hits lifetime low
* Banks fall extending Monday's losses
* Standard Chartered gains after figures
LONDON, March 3 (Reuters) - European shares fell in early
trade on Tuesday, with a key index hitting a lifetime low as
investors sold out of the banking sector and concerns about the
health of the economy weighed on sentiment.
By 1013 GMT, the pan-European FTSEurofirst 300 <>
index of top shares was down 0.7 percent at 677.44 points having
hit a lifetime low of 676.57 points. The index rose to as high
as 690.26 points earlier but lost steam rapidly.
European stocks fell 4 percent in January and nearly 10
percent in February, and analysts said the slide may be
overdone.
"Markets have lost too much in recent days and are
oversold," said Heino Ruland, strategist at Ruland Research.
Banks reversed early gains to become the top losers on the
index. The only stand out riser was Standard Chartered <STAN.L>
which gained 4.3 percent after the group said 2008 profit rose
by 19 percent to $4.8 billion.
"The results were good ... It's pretty much in line with
expectations, so it is a relief rally going on. ... Because it's
a more Asian orientated bank, subprime problems associated with
the U.S. don't exist," a trader said.
HSBC <HSBA.L>, Credit Suisse <CSGN.VX>, UniCredit <CRDI.MI>
and Barclays <BARC.L> were down 1.6-6.2 percent.
Insurers were in the red. Munich Re <MUVGn.DE> fell 1.1
percent after it said its goal of achieving earnings per share
of 18 euros in 2010 is no longer realistic and added that it
cannot give a forecast for 2009 annual results amid the
financial market turmoil. []
Energy stocks also reversed early gains as crude <CLc1>
hovered around $40 a barrel.
BG Group <BG.L>, BP <BP.L>, Royal Dutch Shell <RDSb.L> and
Total <TOTF.PA> were 0.2-1.2 percent lower.
Miners lost ground to trade in the red. Antofagasta
<ANTO.L>, Vedanta Resources <VED.L> and Rio Tinto <RIO.L> were
down 1.7-3.1 percent.
DEFENSIVE DRUGMAKERS GAINS
There were few sectors in positive territory.
Investors were defensive buyers as drugmakers topped the
leader board. AstraZeneca <AZN.L>, GlaxoSmithKline <GSK.L> and
Roche <ROG.VX> were up 1.5-3.1 percent.
Bayer <BAYG.DE> lost 2.3 percent after it cut its 2009
outlook for underlying operating profit to a decline of 5
percent, having previously foreseen an increase, as a slump in
demand for its plastics and foams overshadowed growth at its
drugs unit. []
Later in the session, U.S. Federal Reserve Chairman Ben
Bernanke is due to testify on the economic outlook and the
budget situation before the Senate Budget Committee at 1500 GMT.
"All Bernanke can do is give us warm words of comfort
because he now has to wait for the cycle to carry on around and
the impact of spending to have some effect. The problem is the
banking system is still not working very properly," said Justin
Urquhart Stewart, director at Seven Investment Management.
Across Europe, the FTSE 100 <> index was down 1
percent, Germany's DAX <> was down 0.8 percent, France's
CAC 40 <> was 0.4 percent lower and the broader DJ Stoxx
600 index fell 0.7 percent.
(Reporting by Joanne Frearson; Editing by Jon Loades-Carter)
