* FTSEurofirst 300 falls 1.5 percent
* Banks fall after BNP unit reports loss
* Oils down ahead of OPEC meeting
By Brian Gorman
LONDON, Dec 17 (Reuters) - European shares fell in early
trade on Wednesday as investors shrugged off a Federal Reserve
rate cut and focused instead on worries about more banking
sector losses.
At 0939 GMT, the FTSEurofirst 300 <> index of top
European shares was down 1.5 percent at 822.69 points, led lower
by a 14-percent fall in BNP Paribas <BNPP.PA> after it said its
investment bank unit had made a 710-million-euro loss for the
first 11 months of the year.
BNP Paribas said late on Tuesday its investment banking arm
had been hit by rocky financial markets and by its exposure to
an alleged $50 billion fraud by U.S. financier Bernard Madoff.
Deutsche Bank <DBGKn.DE> fell 6.9 percent amid market talk
of a possible fourth-quarter loss on investment writedowns. The
bank declined to comment.
Among other large banks, HSBC <HSBA.L> was down 5 percent.
Bourses reversed earlier gains, following a late surge in
U.S. stocks in the previous session after the Federal Reserve
slashed interest rates to a range of zero to 0.25 percent, and
pledged more unconventional steps to fight the deepest recession
in generations.
"The Fed can take rates no lower. And lower rates by
themselves won't do it -- we've seen that in Japan, although
it's better to have low rates than high rates, for sure," said
Bernard McAlinden, investment strategist at NCB Stockbrokers in
Dublin.
"The ECB is now more likely to ease further," he added.
Across Europe, Britain's FTSE 100 <>, Germany's DAX
<> and France's CAC-40 <> were down between 1.5 and
1.6 percent.
The FTSEurofirst 300 has fallen more than 45 percent in
2008, hurt a by a credit crisis that has contributed to several
major economies going into recession.
UK UNEMPLOYMENT RISES
UK unemployment data provided further evidence of economic
weakness. The number of Britons out of work and claiming
benefits rose for a tenth successive month in November and by
the largest amount since March 1991.
The Office for National Statistics said the broader ILO
measure of unemployment surged to its highest level since the
three months to June 1999.
In other UK macro news, the minutes of the Bank of England's
meeting this month showed that all nine members of the Monetary
Policy Committee voted to cut rates by 100 basis points to 2
percent, and considered a bigger move.
Only six of the FTSEurofirst 300's 38 industry groups were
higher.
Oil was up more than 3 percent at $44.94 a barrel ahead of an
expected oil production cut by OPEC, but most oil shares were
lower. Total <TOTF.PA>, ENI <ENI.MI> and Royal Dutch Shell
<RDSa.L> were down between 1.2 and 2.2 percent.
Ryanair <RYA.I>, which will enter the FTSEurofirst 300 index
next week, rose 3.6 percent. Europe's second-highest court on
Wednesday upheld a challenge by the Irish low-cost airline
against a European Commission move to block aid received from
Belgium's Wallonia region and Charleroi airport.
Earlier this week, Ryanair launched its hostile attempt to
take over Aer Lingus by writing to its rival's shareholders,
imploring them to accept a 750 million euro ($1.01 billion) bid.
U.S. stocks rallied strongly on Tuesday. The Dow Jones
industrial average <> rose 4.2 percent; the Standard &
Poor's 500 Index <.SPX> jumped 5.1 percent, the Nasdaq Composite
Index <> climbed 5.4 percent.
But futures for the Dow Jones <DJc2>, S&P <SPc2> and Nasdaq
<NDc2> were 2.1-2.5 percent lower.
(Editing by David Cowell)
