Nordic shares close down; StatoilHydro, Nokia and Electrolux off UPDATE

(Adds full report) OSLO (Thomson Financial) - Nordic shares closed down in step with U.S. and European markets as investors turned away from risk as global inflation fears were fed by oil prices which punched through $126 a barrel.

Even oil companies such as Norway's StatoilHydro were down - and the selloff extended to industrials and techs with the likes of Swedish vacuum cleaner-to-fridge maker Electrolux and Finland's mobile phone giant Nokia in the red.

The VINX30 index of the 30 most traded shares listed in Stockholm, Helsinki, Copenhagen and Oslo closed down 1.4 percent to 770.51.

In Stockholm the OMXS30 fell 1.6 percent to close at 1003.5.

Fashion group Hennes & Mauritz B closed down 4.7 percent to 344 crowns, after trading ex-dividend 14 crowns.

However, that technical move aside, other heavyweights felt the pain. Global white goods manufacturer Electrolux was off 2.4 to 91.25 crowns.

Tele2 B shares shed 3.8 percent to close at 133 crowns, after being downgraded to "reduce" from "accumulate" at Handelsbanken, who set a 235 crown target price.

Handelsbanken said Tele2's structural story is losing steam, with the Swedish spectrum license "soaking up cash flow".

It said Tele2 is trading at a 40 percent premium on estimated 2008 EV/EBITDA, versus an average of 20 percent since 2004.

"This is double the premium for half the story," Handelsbanken said.

B shares in construction group Skanska closed down 2 percent at 101.75 crowns, despite announcing it made 265 million crowns in capital gains on sale of office projects.

Husqvarna B shares closed down 2.6 percent to 65.75 crowns. The share downgraded to 'reduce' from 'accumulate' by Handelsbanken, on concerns ahead of the upcoming Q2 report, with the target price set at 67 crowns.

Handelsbanken said the share has a poor risk/reward pay off this quarter.

It said there are plenty of warnings of a weak Q2 yet consensus estimates have barely moved, and pointed to a two week inventory overhang and an expected around 15 percent organic sales decline.

Telecoms systems manufacturer Ericsson was one of the few gainers. Its B shares closed up 1 percent to 15.40 crowns. Analysts were dismissive of rumours out of Frankfurt that Microsoft Corp may be interested in acquiring the Swedish network vendor following its failed bid for Yahoo Inc.

In Helsinki, the OMXH25 index closed down 0.8 percent to 2813.1, led lower by mobile phone giant Nokia which shed 2.6 percent to 18.75 euros. Neste Oil shed 2.2 percent to 18.62 euros. Oslo's OSEAX All Share index fell 1.4 percent to close at 560.1.

Oil producers were sold down in the overall bearish trend with major StatoilHydro closing off 2.3 percent to 193.80 crowns. Oil services companies like Seadrill and Subsea 7 were down, as were seismic oil explorers.

Telecoms operator Telenor was down 4.2 percent at 107.25 crowns. Shares in the company trade ex dividend of 3.40 crowns per share.

Paper producer Norske Skog fell 3.5 percent at 24.70, retracing from the previous session's 11 percent gain.

Shipyard Aker Yards lost 1 percent to 73.90 crowns, giving back some recent gains.

In Denmark, the OMXC20 index closed 0.5 percent down at 435.1. However headset and hearing aid maker GN Store Nord AS gained 7.9 percent to 30 crowns, extending previous gains following Thursday's first quarter report.

Carlsberg A shares closed up 5.8 percent to 37 crowns, amid a more positive stance among investors towards Wednesday's first quarter report, and speculation that former Scottish & Newcastle owners might want to subscribe to its coming rights issue, analysts said.

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