European shares add to losses; banks and oils fall

                                
 * FTSEurofirst 300 falls 0.5 percent
                                
 * Banks, oils decline
                                
 * Vodafone surges for second day
                                
 
                                
 By Brian Gorman
                                
 LONDON, Nov 12 (Reuters) - European shares fell in early
trade on Wednesday, adding to the previous session's sharp
losses and tracking global equity weakness as banks and energy
shares fell on continuing worries over a deep recession.
                                
 At 1011 GMT, the FTSEurofirst 300 <.FTEU3> index of top
European shares was down 0.5 percent at 879.02 points, after
slipping more than 4 percent in the previous session.
                                
 The index has lost more than 41 percent this year, hit by
the credit crisis and resulting economic slowdown.
                                
 UK unemployment data on Wednesday provided the latest
evidence of economic weakness.
                                
 The Office for National Statistics said the number of people
without a job rose to 1.825 million in the three months to
September, the highest level since the three months to December
1997. The claimant count rose 36,500, the biggest rise in
claimant count since December 1992. 
                                
Across Europe, Britain's FTSE 100 <.FTSE>, Germany's DAX
<.GDAXI> and France's CAC-40 <.FCHI> were down between 0.5 and
0.6 percent.   
                                
Analysts were sceptical about the prospects for a significant
recovery, and an early rally, which had seen the index more than
2 percent earlier in the session, faded.
                                
 "I can't see anything which will give the market strength,"
said Justin Urquhart Stewart, director at Seven Investment
Management. "It's going to be a bit soggy today. People are not
willing to participate in the market. There's a buyers' strike
at the moment. We're expecting a rally by the end of year, but
it's only a rally."
                                
 He added that much bad earnings news was already priced into
shares.
                                
 "People are assuming things are bad, and they're having
their assumptions thoroughly fulfilled," he said.
                                
 Banks took most points off the index. France's Natixis
<CNAT.PA>, fell 11 percent after it said it had a tough month in
October. [nLC440684]
                                
 Natixis denied a newspaper report that it had lost 975
million euros ($1.24 billion) in trading operations in October
but said its core investment banking unit had a torrid time last
month.
                                
 BNP Paribas <BNPP.PA> and HSBC <HSBA.L> were down 2.2 and
0.9 percent respectively.    
                                
 But Italy's second-biggest bank UniCredit <CRDI.MI> was 4.4
percent higher despite posting a 54 percent fall in
third-quarter net profit to 551 million euros ($701.8 million),
citing the "dramatic conditions" in the markets.
                                
 The bank, which is boosting capital by 6.6 billion euros by
skipping its cash payout and doing a capital increase to try to
match the strength of European rivals, said changes to IAS
accounting boosted profits by 856 million euros.
                                
 Oils fell as crude prices <CLc1> slipped more than 2 percent
to $58 a barrel. BP <BP.L> and Statoil <STL.OL> fell 1.8 and 4.5
percent respectively. Tullow Oil <TLW.L> sank 4 percent after it
said output in 2008 would undershoot its forecast.
                                
 
                                
 SWISS LIFE <SLHN.VX> SLUMPS
                                
 Insurer Swiss Life <SLHN.VX> was down 14 percent after
saying third-quarter premium volumes fell 11 percent to 3.075
billion Swiss francs ($2.61 billion) and warning it would not
meet its full-year net profit guidance.
                                
  J. Sainsbury <SBRY.L>, Britain's third-biggest supermarket
group, rose 1.7 percent after posting first-half profit towards
the top end of forecasts, but said the economic environment in
the second half was "particularly challenging."
                                
 French power group Electricite de France SA (EDF) <EDF.PA>
was up 2.1 percent after it maintained existing 2008 earnings
guidance as third-quarter sales rose.
                                
  Shares in Holcim <HOLN.VX>, the world's second-largest
cement maker, fell 9.6 percent after it posted a drop in
third-quarter net profit and warned that business would be weak
in the final quarter as global construction slows.
                                
  Mobile telecoms were the strongest-performing sector, with
Vodafone <VOD.L> up 5.9 percent, extending gains from Tuesday,
when its first-half results beat forecasts. Spain's Telefonica
<TEF.MC> was up 1.7 percent, while BT <BT.L>, which reports
first-half results on Thursday, was up 2 percent.    
                                
 Mining stocks gave up early gains as copper prices slipped
back. BHP Billiton <BLT.L>, Anglo American <AAL.L> and Vedanta
Resources <VED.L> were down between 0.7 and 6.7 percent.
                                
 Tenaris <TENR.MI> was up 5.8 percent after equity index
provider MSCI Barra added the Italian oil and gas equipment
services company to its World Index <.MIWD00000PUS>, as part of
its November 2008 semi-annual index review.
                                
 The change will be at the close on Nov 25.
 (Additional reporting by Atul Prakash; Editing by Victoria
Bryan)