Banks lead European markets lower (Reuters) (31-03-2008)

PARIS, March 31 (Reuters) - European stocks opened with almost 2% losses on Monday, as the outlook for banks remains grim.

Among blue chips, Vodafone was the biggest loser, falling by 5 percent on a downgrade by Morgan Stanley over potential EU regulatory action to align mobile phone termination rates with costs.

At 0850 GMT, the FTSEurofirst 300 index of top European shares was down 1.6 percent at 1,245.36 points, after falling by as much as nearly 2 percent.

Analysts believe that the subprime market will continue to hurt and UBS shares fell 3.8 percent after Merrill Lynch said it expected the Swiss lender to make a further $11 billion of first-quarter writedowns.

Other banks were also declining on Monday, with BNP Paribas down 1.9 percent and Credit Suisse down 2.9 percent.

The DJ Stoxx bank index, was losing 1.9 percent, and currently stands at almost 20% lower since the start of the year as investors fear that banks have not yet revealed the full impact of the global credit crisis on their books.

Around Europe, Germany's DAX index was down 1.7 percent, UK's FTSE 100 index down 1.5 percent and France's CAC 40 down 1.3 percent.

On the quarter, the DAX is down 20 percent, the FTSE 100 down 13 percent and the CAC 40 down 17 percent.

 Source: Reuters