April 15, 2014 / 4:45 PM / 4 years ago

Europe shares sag as Ukraine woes, mixed updates weigh

* FTSEurofirst 300 down 1 pct, Euro STOXX 50 down 1.3 pct

* Euro STOXX 50 pierces below support, sends bearish signal

* Speculations over weak China GDP reading weigh on miners

* SABMiller, Nestle, L‘Oreal give weak updates

By Blaise Robinson and Sudip Kar-Gupta

PARIS/LONDON, April 15 (Reuters) - European stocks sank on Tuesday, resuming last week’s sell-off as worries over escalating tension in Ukraine and weak updates by bellwethers including Nestle spooked investors.

Renewed concerns over the pace of growth in China ahead of GDP figures due on Wednesday also weighed on sentiment, with mining giants BHP Billiton and Rio Tinto losing 2 percent ant 3.1 percent respectively.

According to a Reuters poll, China is forecast to have grown at its slowest rate in five years in the first quarter, growing by 7.3 percent, although speculations of a lower growth rate on Tuesday prompted investors to dump European mining shares, traders said.

The FTSEurofirst 300 index of top European shares ended 1 percent lower at 1,306.85 points, resuming last week’s slide during which the index lost about 3 percent, before slightly bouncing back on Monday.

The euro zone’s blue-chip Euro STOXX 50 index dropped 1.3 percent to 3,091.52 points, closing below a key support level, its 50-day moving average, sending a bearish technical signal.

“We’re cautious in the short term, we’re waiting to see how the geopolitical situation evolves. There are a lot of uncertainties about Ukraine, which could become a negative catalyst for stocks if things spin out of control,” Barclays France director Franklin Pichard said.

Russia declared Ukraine on the brink of civil war on Tuesday as Kiev said an “anti-terrorist operation” against pro-Moscow separatists was under way, with troops and armoured personnel carriers seen near a flashpoint eastern town.

Germany’s DAX index, seen as the most vulnerable to the crisis in Ukraine and sanctions against Russia, sank 1.8 percent, with Continental down 2.3 percent and Daimler down 3.4 percent.

“Things have not improved in Ukraine, and this is weighing on the markets,” said Francois Savary, chief investment officer at Swiss bank Reyl, adding that stocks now needed firm evidence of a recovery in earnings to rally again, after making little headway during the first quarter.

On Tuesday, a number of blue-chips posted business updates that fell short of analyst expectations.

SABMiller, the world’s second-largest brewer by sales and which has a large exposure to Africa, China and other emerging markets, posted a modest rise in full-year lager sales volumes, sending its shares down 2.3 percent.

French cosmetics group L‘Oreal and Nestle both undershot market expectations with first-quarter sales, although they forecast a return to top-line growth in coming quarters.

Europe bourses in 2014: link.reuters.com/pap87v

Asset performance in 2014: link.reuters.com/gap87v

Today’s European research round-up (Editing by Alison Williams)

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