* FTSEurofirst 300 down 1 percent, heading for weekly fall
* Two biggest Spanish banks fall, down 20 pct in a month
* Miners down on China worries
* For up-to-the-minute market news, click on []
By Brian Gorman
LONDON, Nov 26 (Reuters) - European shares fell early on
Friday with banks lower as euro zone sovereign debt worries
intensified after a report that Portugal had come under pressure
to accept a bailout.
At 1000 GMT, the FTSEurofirst 300 <> index of top
European shares was down 1 percent at 1,081.47 points.
The index rose 0.5 percent in the previous session, but
trading was subdued because Wall Street was closed for the
Thanksgiving Day Holiday. U.S. markets will open for half a day
on Friday.
The European benchmark, on track to fall 1.9 percent over
the week, was up 67 percent from its lifetime low in March 2009.
"It is amazing how resilient markets have been considering
the financial explosions we have had in Europe and the gunfire
in Korea," said Justin Urquhart Stewart, director at Seven
Investment Management.
"The market is still trying to find where it goes next. A
lot of people may well be saying 'I will take my profits and
square the books'."
A majority of the 16 euro zone nations and the European
Central Bank are urging Portugal to apply for a financial
bailout from a European rescue fund, Financial Times Deutschland
said on Friday.
Without revealing its sources, the paper said a majority of
euro zone countries and the European Central Bank were putting
pressure on Portugal to follow Ireland and Greece and seek aid
in order to save Spain -- European Union's fifth-largest economy
-- from having to do the same. []
The premium investors demand to hold Spanish government
bonds rather than benchmark German debt hit a new euro-lifetime
high on Friday, as worsening investor sentiment continued to
spread to the larger peripheral states. []
Spanish banking heavyweights Banco Santander <SAN.MC> and
BBVA <BBVA.MC> fell 3.1 and 3 percent respectively, and have
both fallen about 20 percent in the last month, as euro zone
sovereign debt worries have resurfaced.
Analysts say concerns that Portugal might be next for a
bailout have weighed even more heavily on Spanish banks than the
Irish crisis. Spanish banks had more than $100 billion exposure
to Portugal at the end of the fourth quarter 2009, according to
June 2010 BIS Quarterly Review.
Other financials under pressure included British insurer
Aviva <AV.L>, down 2.1 percent after Goldman Sachs cut its
target price.
Miners fell in response to weaker metals prices, which
reflected worries that top metals consumer China will move to
rein in lending in its fight against inflation, hurting demand.
Anglo American <AAL.L>, BHP Billiton <BLT.L>, Rio Tinto
<RIO.L> and Vedanta <VED.L> fell between 1.7 and 2.4 percent.
BT RISES
On the upside, BT <BT.L> rose 3.7 percent as the British
telecom company said it sold a 5.5 percent stake in Indian IT
services group Tech Mahindra <TEML.BO>. BT said will continue to
be a shareholder in Tech Mahindra. []
The shares were further helped by Exane raising its price
target.
Across Europe, Britain's FTSE 100 <>, Germany's DAX
<> and France's CAC40 <> fell between 0.7 and 1.4
percent. Spain's IBEX <> fell 2 percent.
The Thomson Reuters Peripheral Eurozone Countries Index
<.TRXFLDPIPU> fell 2.7 percent.
(Editing by Jane Merriman)
