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European Factors to Watch-Shares to fall, focus on earnings

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LONDON, Oct 11 (Reuters) - European equities were set to fall for a fourthstraight session on Thursday, mirroring losses on Wall Street and in Asia, withconcerns about weaker corporate earnings and global growth seen pushing sharestowards one-month lows.

U.S. shares fell in the previous session, digesting disappointing news fromChevron

and Alcoa

as earnings season got under way. Alcoa, whichposted a quarterly loss late on Tuesday, cut its outlook for global aluminumdemand, citing a slowdown in China.

Analysts said that U.S. company results gave an early hint about Europeanearnings, which will gather pace in the second half of October.

"The third-quarter earnings season in Europe is definitely going to be verydifficult. We can't escape from recession and austerity in the region. Your homeeconomy is struggling as well as demand from the rest of the world droppingback," Mike van Dulken, head of research at Accendo Markets, said.

SmartEstimates from Thomson Reuters StarMine show the July-Septemberquarterly results could deliver an average negative earnings surprise from EuroSTOXX 50

companies of 1.6 percent as companies faced a slowdown ineconomic growth.

The stock market is also expected to show a knee-jerk negative reaction toStandard & Poor's move to cut Spain's sovereign credit rating to BBB-minus, justabove junk status. However, some analysts said that could prompt the country toseek a bailout, which could be positive for the stock markets.

"Investors believe this may be the straw that breaks the camel's back, asthe higher bond yields expected to result from the downgrade could force theSpanish government to finally request a bailout," Capital Spreads said in anote.

Futures for Euro STOXX 50, Germany's DAXand France's CAC

were down 0.3 to 0.7 percent. Financial spreadbetters earlier predictedBritain's FTSE 100

to fall as much as 0.3 percent.

The FTSEurofirst 300

index fell 0.5 percent at 1,090.03 points onWednesday. A further drop of about 2 points would be the lowest level for theindex in more than a month.Japan's Nikkei averagefell 0.6 percent on Thursday.MARKET SNAPSHOT AT 0638 GMTLAST PCT CHG NET CHGS&P 5001,432.56 -0.62 % -8.92NIKKEI8,546.78 -0.58 % -49.45MSCI ASIA EX-JP-0.5 % -2.57EUR/USD1.2862 -0.09 % -0.0012USD/JPY77.97 -0.26 % -0.200010-YR US TSY YLD1.677 -- 0.0010-YR BUND YLD1.454 -- -0.06SPOT GOLD$1,765.36 0.19 % $3.42US CRUDE$91.49 0.26 % 0.24

* Asian shares weak on growth woes, euro on backfoot

* Nikkei slips on earnings fears,heads for 3rd day of losses

* Blue chips Chevron, Alcoa lead Wall Street's sell-off

* Euro falls as worries over Spain, growth dent risk appetite

* Brent crude rises toward $115 as Mideast tensions support

* Copper steadies from two-week low, growth woes cap gains

* Gold rebounds from 4-day loss; euro zone gloom weighs

* Prices gain in thin volume on global growth fears

COMPANY NEWSCARREFOUR

Europe's biggest retailer said third-quarter like-for-like sales rose 0.2percent as demand in austerity-hit Italy and Spain remained weak but its coreFrench market showed signs of improvement.

BAE SYSTEMS

Britain's BAE Systems said on Thursday it was trading in line withexpectations but noted that it faces uncertainty in its core United Statesmarket where a new government will have to tackle its federal deficit.

EADS, LAGARDERE

Europe's two biggest aerospace firms will go back to the drawing board tofind new strategies after Germany stymied the world's biggest arms and aviationcompany merger. [ID:nL6E8LAOPN

Lagardere, the French media group, owner of 7.5 percent of EADS, renewed itssupport in the management of the Airbus maker after its merger talks with BAESystems failed.

SIEMENS

Germany's Siemens may outline job cuts and office closures on Thursday tostop profits sliding as customers put off ordering engineering equipment becauseof Europe's economic crisis.

BURBERRY,

The British fashion house, which warned on profit last month, confirmedretail sales growth slowed sharply in its second quarter as demand eased in theUK and China.

ROYAL BANK OF SCOTLAND

The bank set a price of 175 pence per share for the stock market listing ofinsurer Direct Line, close to the middle of the range originally set and valuingthe business at 2.6 billion pounds ($4.2 billion).

SANOFI

The French drug maker has dropped plans to exit its research laboratory inthe southern town of Toulouse as part of a reorganisation of its French researchoperations, Industry Minister Arnaud Montebourg said.

RENAULT, PSA PEUGEOT CITROEN

Europe's car market will not really recover without EU-led coordination ofcapacity cuts, Fiat

and Chrysler Chief Executive Sergio Marchionnesaid, in an apparent back-track on comments he made at the Paris auto show lastmonth.

GDF SUEZ

GDF Suez' Belgian unit Electrabel said that it has closed its 350 MWcombined-cycle gas turbine plant at Saint-Ghislain, near the French border,after an explosion earlier in the day.

ING

Pan Asian insurer AIA Group Ltd has agreed to buy ING's Malaysian insuranceoperations for $1.73 billion in cash, handing the Dutch financial services firmits first deal in a nine-month drive to sell off Asian assets.

OUTOKUMPU

The Finnish stainless steel maker's chief executive Mika Seitovirta andother top management receive bonuses to keep them in the company as it isacquiring ThyssenKrupp's

Inoxum unit, daily Helsingin Sanomatreported.DEUTSCHE TELEKOM

The shares of wireless service provider MetroPCS

closed down 4 aboutpercent on Wednesday after a source said Sprint Nextel Corpis stillweighing whether to make a counter bid for the company.

(Reporting by Atul Prakash; Editing by Toni Vorobyova)

((atul.prakash@thomsonreuters.com)(+44 20 7542 6189)(Reuters Messaging:atul.prakash.thomsonreuters.com@reuters.net))

Keywords: MARKETS EUROPE FACTORS