* FTSEurofirst 300 down 0.4 pct, Euro STOXX 50 down 0.6 pct
* DAX underperforms again on worries over Ukraine
* Deutsche Bank hurt by report of capital hike
By Blaise Robinson
PARIS, April 25 European shares fell on Friday
as new signs of violence in Ukraine weighed on stock markets
that had recently been buoyed by corporate takeover activity.
Ukrainian forces killed up to five pro-Moscow rebels on
Thursday and Russia launched army drills near the border in
response. Seven people were also injured overnight at a
pro-Ukrainian checkpoint near Ukraine's Black Sea port of Odessa
when an explosive device blew up.
Ukrainian Prime Minister Arseny Yatseniuk accused Russia of
wanting to start World War Three by occupying Ukraine
"militarily and politically", in some of the strongest language
he has used.
Steen Jakobsen, Saxo Bank's chief investment officer and
chief economist, warned that investors have been complacent
about the crisis in Ukraine, ignoring the risks of escalation.
"The market seems willing to give the diplomatic route all
chances despite the obvious violations by both parties. Overall
the situation is escalating by the hour, meanwhile investors are
mostly focusing instead on the Fed's tapering and the ECB's
quantitative easing," he said.
"The weekend could bring a reality check as the risk of
further violence is high and could potentially upset the
Germany's DAX index, seen as the European market
most vulnerable to the crisis between Ukraine and Russia, was
down 0.8 percent, at 9,473.90 points.
The DAX, which has been outperforming European stock indexes
for years, is down 1 percent so far this year, trailing behind
France's CAC 40, up 3.9 percent in 2014, Milan's FTSE MIB
up 14 percent and Madrid's IBEX up 4.5 percent.
"I'm a seller here. The DAX has got the legs to come off
down to 9,250 points," said Darren Courtney-Cook, head of
trading at Central Markets Investments Management.
Deutsche Bank featured among the biggest
blue-chip losers, down 2.1 percent, hurt by a report saying the
lender is considering whether to raise as much as 5 billion
euros ($6.91 billion) in capital this year to cope with European
stress tests and new capital rules.
Bucking the trend, shares in Gucci's parent Kering
surged 4.2 percent after the company said sales trend for the
luxury brand were improving.
The pan-European FTSEurofirst 300 index, which hit
a near 6-year high earlier this month, was down 0.4 percent at
1,338.24 points on Friday.
The euro zone's blue-chip Euro STOXX 50 index
shed 0.6 percent, to 3,170.41 points.
Europe bourses in 2014: link.reuters.com/pap87v
Asset performance in 2014: link.reuters.com/gap87v
Today's European research round-up
(Additional reporting by Sudip Kar-Gupta in London; Editing by