Europe shares fall; Greece aid fails to calm nerves

* European shares fall for 2nd straight session

* Market unimpressed with Greece bailout

* For the latest on Greek debt crisis, click [ID:nTOPNOW2]

By Dominic Lau

LONDON, May 3 (BestGrowthStock) – European shares edged lower on
Monday on concerns that a massive bailout package for Greece may
face political obstacles and on doubts that Athens can implement
tough austerity measures agreed in exchange for aid.
Greek bank shares (.FTATBNK: ) lost 1.6 percent in choppy
trade despite the European Central Bank announcing its
acceptance of all Greek government bonds as security for loans,
even if their credit rating continues to fall.

European banks were also weaker, with BNP Paribas (BNPP.PA: ),
Banco Santander (SAN.MC: ), Deutsche Bank (DBKGn.DE: ), BBVA
(BBVA.MC: ), UBS (UBSN.VX: ) and Natixis (CNAT.PA: ) down 0.4 to 1.8
percent.

By 1018 GMT, the FTSEurofirst 300 (.FTEU3: ) index of leading
European shares was down 0.4 percent at 1,058.28, after losing
2.7 percent last week — its third straight week of declines. It
fell 1.5 percent through April, but is up 1.2 percent this year.

“The catastrophe of default that everybody is worried about
is behind us, but the market realises that it will be a very
long, difficult road to travel before it can get better,” said
Philippe Gijsels, head of research at BNP Paribas Fortis Global
Markes in Bruseels.

Gijsels said the market was concerned whether Athens can
carry out the tough steps agreed with its European partners, and
other euro zone peripheral countries could come under pressure.

European countries agreed to a 110 billion euros ($146.5
billion) aid package to Greece at the weekend, and in exchange
Athens has promised to carry out spending cuts and tax hikes
worth 30 billion euros over three years, on top of
belt-tightening measures already taken.

The emerging aid, the most ever for a country, alleviated
some fears of a near-term sovereign debt default, but the
package still has to obtain parliamentary approvals and left
open the question of which fiscally vulnerable country in Europe
might be next.
However, strong quarterly company earnings have helped
support the equities market. According to Thomson Reuters
Proprietary Research, nearly three-quarters of European firms
that have reported first quarter results beat market estimates.

BP DOWN IN FRANKFURT

BP (BP.L: ) shares in Frankfurt (BP.F: ) sagged 3.1 percent
after the huge oil slick caused by an underwater leak continued
to creep toward the U.S. Gulf Coast, with the Obama government
pressing the energy major to stem the oil gushing from its
ruptured offshore well.

“The problem with BP is, as long as the leak continues,
nobody knows how much it’ll cost to clean up the mess, so the
stock could continue to sink for a while,” a Paris-based trader
said.

Within the sector, Royal Dutch Shell (RDSa.AS: ) eased 0.4
percent and Total (TOTF.PA: ) was down 1 percent.

Across Europe, Germany’s DAX (.GDAXI: ) slipped 0.2 percent,
France’s CAC 40 (.FCHI: ) lost 0.7 percent and Spain’s IBEX 35
(.IBEX: ) eased 1 percent. UK markets were closed for a holiday.

U.S. stock index futures (SPc1: ) (DJc1: ) (NDc1: ) put on 0.2 to
0.3 percent, indicating a firmer start on Wall Street.

U.S. shares tumbled on Friday to close out the worst week
since January as news of a criminal probe into Goldman Sachs
(GS.N: ) unnerved investors already anxious about the prospects
for heavy regulation from Washington.

Stock Investing

($1=.7508 Euro)
(Additional reporting by Atul Prakash in London and Blaise
Robinson in Paris; Editing by Hans Peters)

Europe shares fall; Greece aid fails to calm nerves