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Europe: Shares weighed down by disappointing earnings; Bayer falls

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[MILAN] European stocks fell on Thursday after a choppy session, weighed down by some disappointing earnings updates, while Bayer and BASF dropped on reports they could be interested in buying Monsanto.

The FTSEurofirst 300 index dropped 0.55 per cent, having risen by as much as 0.9 per cent earlier in the session on the back of gains in crude oil prices, which later turned lower.

Oil prices fell back after touching six-month highs, as selling prevailed on signs of another storage build at the hub for US crude futures.

Bayer fell 4.8 per cent after Bloomberg reported the German group was exploring a bid for Monsanto, while BASF fell 2.1 per cent after financial news website Street Insider reported it was also looking at a Monsanto acquisition.

Aegon was the worst-performing stock in the region. The Dutch insurer slumped 11.4 per cent after reporting a smaller than expected first-quarter underlying pretax profit of 462 million euros (S$722 million).

Credit Agricole fell 4.9 per cent after the French bank reported a 71 per cent fall in quarterly net income, while Italian insurer Generali slipped 4 per cent after weak interest rates and fewer capital gains sent its net profit down 12 per cent, missing expectations.

But KBC rose 4.6 per cent after the Belgian financial group posted a better net profit than expected as increasing customer deposits, loans and higher insurance income made up for some of the group's increased tax bill.

Zurich Insurance rose 6.6 per cent after swinging back to profit that beat analysts' expectations.

Anthilia Capital Partners' chief investment officer, Andrea Cuturi, said there was no particular catalyst driving the market on Thursday, adding that the earnings season in Europe had been disappointing though it might have already been priced in.

According to data from Thomson Reuters StarMine, 61 per cent of the companies on the pan-European STOXX 600 index. STOXX have beaten or met market forecasts with their first quarter earnings, although many have done so by cutting costs in order to offset lower revenues.

German utility RWE rose 6.8 per cent after its first-quarter operating profit grew more than expected, helped by an unusually high earnings contribution from its trading and gas midstream division.

REUTERS