Banks push Europe shares lower, Citigroup weighs

                                
 * FTSEurofirst 300 index closes down 1.3 percent
                                
 * Banks under pressure; Citigroup concerns
                                
 * Commodities fall as crude, metals slip
                                
 By Joanne Frearson
                                
 LONDON, Dec 17 (Reuters) - European equities ended lower on
Thursday, snapping a five-day winning streak, with concerns over
tough new Basel regulations and Citigroup's <C.N> equity
offering getting a cool response hurting banking stocks.
                                
 The pan-European FTSEurofirst 300 <.FTEU3> index of top
shares closed down 1.3 percent at 1,018.25 points. The index is
up 58 percent since reaching a record low in early March and is
up 23 percent for the year.
                                
 "The factors that are worrying the markets are Citigroup
offering equities at a discount in order to raise capital,
concerns about the Fed and then you got the dollar rising," said
Peter Dixon, economist at Commerzbank.
                                
 "There are a lot of things going on. But we are rolling
towards the end of the year and investors are taking risk off
the table at a time when trading volumes are thin, so movements
are exaggerated."
                                
 Banks were the top losers. HSBC <HSBA.L>, Societe Generale
<SOGN.PA>, Lloyds Banking Group <LLOY.L> and Banco Santander
<SAN.MC> were down 1.9-8.1 percent.
                                
 Citigroup <C.N> was down 6.7 percent on Wall Street after it
sold $17 billion shares at $3.15 a share.
                                
 The sector was also knocked after regulators said big banks
will have to set aside more profit or even raise capital
protection under tough new proposals from the Basel Committee on
banking. [ID:nWEA6017]
                                
 The U.S. Federal Reserve said it would let most of its
special liquidity facilities expire by early 2010 and global
regulators proposed stricter capital rules for banks.
[ID:nN16114058]
                                
 COMMODS UNDER PRESSURE
                                
 Energy stocks were under pressure as crude <CLc1> slipped
1.6 percent as the dollar rose. BG Group <BG.L>, BP <BP.L>,
Royal Dutch Shell <RDSa.L> and Total <TOTF.PA> were 0.8 percent
to 2 percent lower.
                                
 Miners were lower as copper <MCU3=LX> fell 2.3 percent,
aluminium <MAL3=LX> lost 2.1 percent, and nickel <MNI3=LX> was
down 2.4 percent.
                                
 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 down 1.7-4.1 percent.
                                
 Investor confidence also deteriorated after the number of
U.S. workers filing new applications for jobless insurance
unexpectedly rose last week, bumped up by seasonal adjustments,
according to government data. [ID:nN17380585]
                                
 The VDAX-NEW volatility index <.V1XI> showed investor
appetite for risky assets such as equities fell. Charts
suggested the index faced Fibonacci resistance at around 1,023
points -- its 38.2 percent retracement of the major fall from
July 2007 to March 2009.
                                
 The index has failed to convincingly break the level despite
repeated attempts in the past seven weeks.
                                
 "The FTSEurofirst's short term (technical) outlook is
neutral. It's still very much within its range and it looks like
it's struggling here," said Phil Roberts, technical analyst at
Barclays Capital.
                                
 Across Europe, the FTSE 100 <.FTSE> index was down 1.9
percent, Germany's DAX <.GDAXI> was 1 percent lower and France's
CAC 40 <.FCHI> fell 1.2 percent.
 (Additional reporting by Atul Prakash; Editing by Dan Lalor)