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UPDATE 1-Tech selloff spreads to European stocks, carmakers up

Sruthi Shankar and Amy Caren Daniel

* Tech stocks dive following Nasdaq's move into correction

* Auto stocks outperform on upbeat data, broker comments

* Hargreaves Lansdown down 5% on Woodford woes (Adds quote, updates prices)

June 4 (Reuters) - European shares fell on Tuesday as U.S. antitrust action against Google and other major technology companies drove peers in the region lower, although a boost from automakers capped losses.

Europe's main STOXX 600 was down 0.3% by 0825 GMT tracking losses on Wall Street and Asian markets overnight, with the technology sector losing 1.6%.

New York's tech-heavy Nasdaq entered correction territory on Monday as Amazon and Alphabet's Google were the first to face an antitrust probe from regulators, with sources saying Apple and Facebook may follow.

"The United States is starting to cause more red tape on tech companies. This will affect all companies that do business with tech, and that will cause a ripple effect in Europe," said Florian Hense, European economist at Berenberg.

Global stock markets have succumbed to selling pressure in recent weeks, with the benchmark STOXX 600 posting its worst monthly performance in over three years in May.

Weak economic numbers worldwide have pointed to slowing growth and the risk of recession ahead as a trade war between the United States and China escalates.

"As the U.S. president is ratcheting up trade tensions, he is using tariffs to pursue non-economic goals which is worrisome and highlights the risk of a solution being very far away," said Hense.

There was a hint of the risks for the fund management community if a decade-long stocks rally is drawing to a close in the suspension by high-profile fund manager Neil Woodford of his Woodford Equity Income Fund.

Fund supermarket Hargreaves Lansdown, which includes the Woodford fund in six of its Multi-Manager investment packages, fell more than 5% in response, making it the top faller on London's FTSE 100.

A 1.6% jump in auto stocks helped Germany's DAX up 0.2% and Italy's FTSE MIB rise 0.9% after better-than-expected sales numbers from the U.S. market on Monday.

Brokerage RBC also started coverage on Germany's Daimler and Volkswagen with "outperform" ratings, sending their shares up nearly 2.5% each.

Italian banks rose 1.8%, with traders citing conciliatory remarks from Italian Prime Minister Giuseppe Conte on respect of EU rules. The pan-European banking index was up 0.8%.

The ECB holds its next policy meeting on Thursday and is expected to keep settings unchanged though there is growing speculation it could shift to a more dovish footing. Comments from the Federal Reserve on Monday raised expectations the U.S. central bank is moving closer to a rate cut. (Reporting by Sruthi Shankar and Amy Caren Daniel in Bengaluru; editing by Patrick Graham)