European shares end lower; oils, autos weigh
* FTSEurofirst 300 index ends 1.6 percent lower
* Energy shares top the losers list, track weak crude
* Autos under pressure due to falling car demand
By Atul Prakash
LONDON, Jan 12 (Reuters) - European shares ended lower for a fourth straight session on Monday, dragged down by weaker energy shares on the back of falling crude and as the concerns about the prospect for further corporate sector losses mounted.
The FTSEurofirst 300 .FTEU3 index of top European shares closed 1.6 percent lower at 853.22 points after falling 0.5 percent on Friday. The index plunged 45 percent in 2008.
The energy sector took the most points off the index as crude fell about 7 percent, pushed lower by growing evidence recession is reducing global energy consumption.
BP (BP.L), Royal Dutch Shell (RDSa.L), BG Group (BG.L), Tullow Oil (TLW.L), Norsk Hydro (NHY.OL) and Total (TOTF.PA) shed 0.8-10 percent.
Shares in automakers, hard hit by falling demand for cars across the world, also slipped. BMW (BMWG.DE), Daimler AG (DAIGn.DE), Porsche (PSHG_p.DE), Volkswagen AG (VOWG.DE), Renault (RENA.PA) and Fiat (FIA.MI) were down up to 8.4 percent.
"The levels of indexes seem to reflect that they already have taken on board a lot of profit forecasts being reduced. Nevertheless, risk aversion is the main story of the day," said Valerie Plagnol, chief strategist at CM-CIC Securities.
"We are not yet sure of the depths and lengths of the recession and as long as we cannot access that properly, it's hard to really look at a rebound. Sector by sector, we need to be very selective and very careful," she said.
The Organisation for Economic Cooperation and Development's leading indicator for the Group of Seven (G7) nations fell to 93.3, pointing to "deep slowdowns in the major seven economies and in major non-OECD member economies, particularly China, India and Russia". [nPAB004591]
Across Europe, Britain's FTSE 100 index .FTSE, Germany's DAX .GDAXI and France's CAC 40 .FCHI fell 0.5-1.6 percent.
DOWNTURN HITS CORPORATES
The gloomy economic outlook continued to hurt companies.
Global miner Rio Tinto (RIO.L) postponed the $2.15 billion expansion of its Brazilian iron ore mine as the global downturn hit steel output, and a newspaper said the debt-laden group was selling an Australian coal unit. Its shares fell 1.4 percent.
Other miners were also weaker. BHP Billiton (BLT.L), Anglo American (AAL.L), Vedanta Resources (VED.L), Xstrata (XTA.L) and Antofagasta (ANTO.L) fell up to 8.1 percent.
"What we see now is some kind of disillusion in the market in the sense that the focus is now on the corporate earnings season that lies ahead," said MM Warburg economist Joerg Rahn.
"There are concerns that company outlooks for 2009 and 2010 could be worse than the market has priced in so far."
But banks rose after news Britain was to take a 43.4 percent stake in the combined Lloyds TSB-HBOS (LLOY.L) HBOS.L because shareholders had largely shunned both lenders' rights issues. Lloyds rose 7 percent, HBOS gained 5.4 percent, Barclays (BARC.L) was up 3.1 percent and HSBC (HSBA.L) rose 1.6 percent.
In the United States, the break-up of banking giant Citigroup (C.N) moved a step closer, as it closed in on a deal to join its Smith Barney business with Morgan Stanley's brokerage operation (MS.N), people familiar with the matter said. [nLC198932]
Among other movers, Germany's RWE (RWEG.DE) slipped 2.7 percent after it said it was to buy Dutch peer Essent's production and delivery assets for an agreed 8.2 billion euros ($11 billion). (Additional reporting by Joanne Frearson in London and Christoph Steitz in Frankfurt)
