European stocks snap 3-session rally; miners gain
PARIS, July 21 (Reuters) - European stocks fell in early trade on Monday, snapping a three-session recovery, but gains in the mining sector helped cushion the fall.
HBOS HBOS.L dropped 3 percent after the British lender said shareholders subscribed for just 8.3 percent of shares in its 4 billion pound ($8 billion) rights issue, leaving its underwriters to try to sell almost 3.8 billion pounds of stock. At 0718 GMT, the FTSEurofirst 300 .FTEU3 index of top European shares was down 0.7 percent at 1,156.21 points. The index gained around 3.2 percent last week, rallying after quarterly results from Citigroup (C.N) and Wells Fargo (WFC.N) calmed fears over banks' balance sheets.
"There is, hanging over the market, the idea that the real cyclical companies haven't yet had major profit warnings wereas we know that the economy is slowing down," said Arthur van Slooten, strategist at Societe Generale, in Paris. Tech and media shares were on the downside on Monday, falling after disappointing earnings from Google GOOG.L and Microsoft (MSFT.O). Infineon (IFXGn.DE) dropped 0.6 percent and Capgemini (CAPP.PA) fell 1.2 percent.
Mining shares gained ground, rallying along with most base metal prices. Rio Tinto (RIO.L) added 1.2 percent.
(Reporting by Blaise Robinson)
