European shares extend losses; banks weigh

LONDON, Dec 8 (Reuters) - European shares extended losses on Tuesday, with traders citing a media report about the size of losses facing Nakheel, a unit of Dubai World, as one of the key reasons for sharp losses in banks.

Weak German industrial output for October also weighed on the pan-European FTSEurofirst 300 .FTEU3 index, which was down 1 percent at 1,010.18 points.

“Basically it was two things. First of all it was the German figures but more importantly, Nakheel had a first half loss of $3.65 billion a document showed according to Bloomberg News,” a trader said.

Nakheel declined to comment.

Banks were among the top losers, with Royal Bank of Scotland RBS.L, Barclays BARC.L, HSBC HSBA.L and Standard Chartered STAN.L down 1.6-7 percent.

Another trader said: “It’s the weak German industrial output numbers and a report about big losses at Nakheel. Anything Dubai-related has a big impact on the banks and with trading thin everthing gets exaggerated.” (Reporting by Dominic Lau, Jon Hopkins and Atul Prakash)