Europe shares stage biggest fall in two months

LONDON, May 20 (Reuters) - European shares staged their biggest one-day fall in two months on Tuesday, driven by declines in commodity stocks, while record-high oil and troubling U.S. inflation data weighed on the broader market.

Banks and mining stocks, which pared some of their recent gains, were the largest drags on the European equity market, as Rio Tinto (RIO.L: Quote, Profile, Research, Stock Buzz) and BHP Billiton (BLT.L: Quote, Profile, Research, Stock Buzz) fell between 6.2 and 7.4 percent, while among banks, HSBC (HSBA.L: Quote, Profile, Research, Stock Buzz) lost 2 percent.

The FTSEurofirst 300 index of top European shares fell 1.89 percent to an unofficial close of 1,352.24 points, making this its worst one-day fall since March 17, when the index hit a 2-1/2 year low. "The next move for the market is going to be down and we're going to have a look at the mid-March lows probably. Knock on wood we don't go through them, simply because there was so much fear and panic around two months ago ... we're not in as bad a situation, but we are by no means out of the woods," said Andrew Lynch, a portfolio manager at Schroders. (Reporting by Amanda Cooper)