* FTSEurofirst 300 down 0.4, Germany's DAX down 0.9 pct
* Report of Russian shots in Ukraine reignites sell-off
* Mining shares hurt again by soft Chinese data
* Bouygues-Iliad deal sparks rally in French telcos
* Periphery outperforms as investors bet on local recovery
By Francesco Canepa
LONDON, March 10 European shares fell for the
second straight session on Monday, hit by tensions between
Russia and Ukraine and weak economic data from the world's
second-largest economy, China.
Most European indexes swung lower in the afternoon after the
Interfax news agency reported Russian troops had opened fire
with automatic rifles during a takeover of a Ukrainian naval
post in Crimea.
The pan-European FTSEurofirst 300 index closed 0.4
percent lower at 1,320.98 points after re-testing a low set last
week earlier in the session, in a broad sell-off involving most
German steel maker ThyssenKrupp, down 3 percent,
was among the top fallers in Europe as Chinese steel and iron
ore futures slumped to their lowest levels ever on concerns
about a slowdown in the world's top commodity buyer.
Trade data showed China's exports in February tumbled 18.1
percent from a year earlier, raising questions about the health
of the country's economy.
"The Ukrainian crisis worries me more than the slowdown in
China because of its proximity to Europe," said Claudia Panseri,
global equity strategist at Societe Generale Private Banking.
"It could also have a negative impact in terms of contagion
effect and capital outflows from other emerging markets at a
time when global economic growth is still fragile."
Panseri preferred shares exposed to a recovery in Europe's
own economy, such as banks or German and British mid and
small-cap stocks, to companies with an emerging market presence.
Shares with the largest exposure to Russia fell sharply,
such as Austrian bank Raiffeisen Bank International
and Finnish tyre maker Nokian Renkaat, which dropped
2.7 percent and 2 percent respectively.
GERMANY HIT, PERIPHERY OUTPERFORMS
Germany's Dax blue-chip index, seen as a play on
the global economy through exporters such as car maker VW
, shed 0.9 percent.
"Germany is hurt a bit more than the others as it is an
exporter nation with vast interests in both Central Europe and
China," said Philippe Gijsels, head of research at BNP Paribas
Fortis Global Markets.
"However, in the larger scheme of things this is probably a
healthy correction. We see this as a little pause and not the
end of the bull market, and remain buyers of the dip."
By contrast, indexes with a relatively high weighting in
banking shares and a strong domestic focus, such as Italy's FTSE
MIB and Spain's Ibex rose, by 0.6 percent and
0.3 percent, respectively.
The former was also helped by data showing Italian
industrial production rebounded more than expected to post its
strongest increase for more than two years.
French telecom shares also rose following a deal between
Bouygues and Iliad, which rallied 8.7 percent
and 11.1 percent respectively.
Bouygues' telecom unit agreed to sell its mobile network and
much of its spectrum to Iliad as a way to head off competition
regulators' concerns about its pending bid for Vivendi's SFR
Robin Bienenstock, analyst at Bernstein Research, said that
a combination of SFR and Bouygues would lift the entire sector,
leaving out only cable operator Numericable, which had
also bid for SFR and whose shares fell 12.4 percent on Monday.
Europe bourses in 2014:
Asset performance in 2014:
Today's European research round-up