* Lisbon's PSI 20 sinks 2.2 pct on Espirito Santo family
* FTSEurofirst 300 down 0.2 pct, Euro STOXX 50 up 0.2 pct
* Sodexo hit after poor update
(Recasts with Portugal lagging)
By Francesco Canepa
LONDON, July 9 Portuguese shares lagged European
markets on Wednesday, hit by concerns about the financial health
of one of the country's largest financial groups.
Lisbon's PSI index fell 2.2 percent, led by an 11
percent fall in Espirito Santo Financial Group (ESFG),
the largest shareholder of Portugal's largest listed bank, Banco
Business daily Diario Economico reported on Wednesday
Portugal's Espirito Santo banking family, who control ESFG, is
set to propose to creditors an extension of the maturities of
the debts issued by its Luxembourg-registered holding company.
The PSI, which has risen 24 percent in the past 12 months,
has underperformed other European markets since concerns
surrounding Espirito Santo arose as well as after some
disappointing economic data came out last month.
"Investors are starting to wake up to this bad coffee,"
Franz Wenzel, chief strategist at AXA Investment Managers, said.
"Also they've made fairly decent returns (on Portuguese shares)
so why not taking profit and take some shelter."
The pan-European FTSEurofirst 300 index, which hit
a 6-1/2 year high in late June, was down 0.2 percent at 1,361.08
The euro zone's blue-chip Euro STOXX 50 index,
meanwhile, was up 0.2 percent, recovering some ground after a
1.4 percent fall in the previous session.
A disappointing trading update from French caterer Sodexo
, coming hard on the heels of a profit warning from Air
France-KLM on Tuesday, fuelled concerns about weak
corporate earnings ahead of the second-quarter reporting season.
Sodexo saw its shares fall 1.4 percent after it said its
fourth quarter would be weaker than expected due to the delayed
start-up of some major contracts. The group cut its full-year
sales growth goal.
"There are some worries that some company results may not be
as strong as expected," said Berkeley Futures associate director
($1 = 0.5877 British Pounds)
(Editing by Lionel Laurent/Jeremy Gaunt)