* FTSEurofirst 300 index down 1.1 pct
* Banks fall; miners lower after Alcoa cuts dividend
* Non-life insurers gain
By Joanne Frearson
LONDON, March 17 (Reuters) - European shares snapped a
five-day winning streak in early trade on Tuesday as news Alcoa
<AA.N> is to slash its dividend weighed on miners, oils tracked
crude lower and investors took profits in banks.
By 0938 GMT, the pan-European FTSEurofirst 300 <>
index of top shares was down 1.1 percent at 713.34 points,
following a 2.7-percent rise the previous session.
Banking stocks were one of the worst performers. American
Express <AXP.N> said that U.S. credit card delinquencies rose to
8.7 percent in February from 8.3 percent in January, while a
rise in the default rate at Citigroup <C.N> to 9.33 percent in
February from 6.95 percent a month earlier disappointed
analysts. []
BNP Paribas <BNPP.PA>, Credit Suisse <CSGN.VX> and Banco
Santander <SAN.MC> were down 1.2-2.8 percent.
Analysts said investors were booking gains after a 4.5
percent gain in the DJ STOXX European banks index <.SX7P> over
the past week.
"Some profit taking in the financials following on from the
news by American Express about arrears on its credit cards,"
said Jim Wood-Smith, head of research at Williams de Broe.
"It has just been taken as an excuse to bank profits after
the rises we have seen in the last few sessions as the news
shouldn't have come as a surprise."
Mining stocks fell after Alcoa said it would slash its
dividend, issue stock and convertible notes worth about $1.1
billion and trim its 2010 spending to help weather the steep
downturn in aluminum demand. []
The stock <ALU.F> was down 12 percent in Frankfurt.
Anglo American <AAL.L>, Antofagasta <ANTO.L>, BHP Billiton
<BLT.L>, Eurasian Natural Resources Corporation <ENRC.L>, Rio
Tinto <RIO.L> and Xstrata <XTA.L> were 1.9-5.4 percent lower,
also depressed by a 1 percent fall in copper futures <MCU3=LX>.
Energy stocks were lower as crude <CLc1> fell below $47 a
barrel. Royal Dutch Shell <RDSa.L> lost 3.1 percent after it
said it was under investigation by U.S. authorities for
potential breaches of overseas bribery rules. []
BG Group <BG.L>, BP <BP.L> and Total <TOTF.PA> were down
0.9-1.2 percent.
NON-LIFE INSURERS GAIN
One of the few sectors not in the red was non-life insurers.
A senior EU lawmaker said the European Union is close to a deal
on rules obliging insurers to set aside enough capital to cover
risks on their books, easing industry worries that the process
would drag on for months. []
Swiss Re <RUKN.VX> gained 3.3 percent after it said it
should be able to generate enough funds to buy back convertible
bonds issued to Warren Buffett's Berkshire Hathaway <BRKa.N>.
Generali <GASI.MI> was up 1.3 percent.
Later in the session, investors will be looking at U.S. data
on housing starts in February, as well U.S. monthly producer
price data and Germany's ZEW economic sentiment index.
A two-day U.S. Federal Reserve meeting starting later in the
day will also be in focus.
"What is interesting in the U.S. housing data is there have
actually been continuing signs of further mortgage applications
which is encouraging. I hope to see these figures a bit more
positive. But with PPI I expect it to be weaker and German ZEW
is likely to continue to be poor," said Stewart.
Across Europe, the FTSE 100 <> index was down 0.8
percent, Germany's DAX <> was down 0.8 percent and
France's CAC 40 <> was 1.4 percent lower.
(Editing by David Cowell)
(joanne.frearson@thomsonreuters.com; +44 207 542 2773,
Reuters Messaging:joanne.frearson.thomsonreuters.com@reuters.net)
