European shares slip on fears over financials, oil

LONDON, Aug 28 (Reuters) - European shares slipped in early trade on Thursday as quarterly results did little to dispel worries over the financial sector and oil threatened to breach $120 a barrel on weather-related supply concerns.

At 0717 GMT, the FTSEurofirst 300 index .FTEU3 of top European shares was down 0.2 percent at 1,170.68 points.

Banks took the most points off the index as results from financials highlighted the problems that have battered the sector over the past year amid a credit crisis.

French group Credit Agricole (CAGR.PA) fell 0.9 percent after its posted a 94-percent fall in second quarter profit.

Insurer Swiss Life (SLHN.VX) led losers on the FTSEurofirst 300, slumping more than 9 percent after issuing a profit warning, while French bank Natixis (CNAT.PA) slid 6 percent after posting a quarterly loss of more than a billion euros.

Oil CLc1 gained almost $1 a barrel to trade above $119 on fears that Tropical Storm Gustav may hit the Gulf of Mexico after it morphs into a major hurricane, paralysing the heart of U.S. offshore production.

BP (BP.L) gained 0.4 percent and Royal Dutch Shell (RDSa.L) ticked up 0.3 percent.

The FTSEurofirst 300 is down 0.7 percent so far in August and is in line for its ninth monthly loss in the last 10 months.

"August has been fairly bleak but volumes have been low and there's been no reason to push up," said Justin Urquhart Stewart, investment director at Seven Investment Management.

"September is going to be a season of not just meteorological storms but also of more writedowns," he said.

(Reporting by Sitaraman Shankar)