* STOXX 600 ends down 0.1 pct
* Banks rise, Santander to buy Banco Popular
* German utilities gain after court ruling
* Energy stocks drop as oil prices plunge
* UK election, ECB meeting in focus
(Adds details, closing prices)
By Kit Rees
LONDON, June 7 Banks and utilities supported
European stocks on Wednesday, with relief that Spain's
struggling Banco Popular was being rescued by Santander
lifting bank shares.
The STOXX 600 index fell 0.1 percent, weighed down
by a late drop in energy stocks. Crude oil prices plunged after
data showed U.S. stocks of crude oil and gasoline surprisingly
rose last week.
Britain's FTSE 100 index fell 0.6 percent and
Germany's DAX inched 0.1 percent.
Although shares in Santander fell 0.9 percent in choppy
trade and Banco Popular's were suspended, European banks
were among the standout performers, gaining 0.7 percent.
Santander said it would buy Popular and carry out a capital
increase of around 7 billion euros ($7.9 billion).
"As a stand-alone bank, (Popular) was close to failing ...
and the failure of any bank, as we've seen in the past, can set
of that chain of events where the whole banking sector gets
freaked out, investors especially," said Mike van Dulken, head
of research at Accendo Markets.
Spain's Bankia, Italy's UniCredit and
France's Societe Generale were all up between 1
percent and 4.9 percent.
European utilities also gained, led by Germany's
E.ON and RWE. Both rose more than 5 percent
after the country's highest court declared a nuclear fuel tax
illegal, enabling them to claim back 6 billion euros in cash
Shares in Swedish biometric firm Fingerprint Cards
were the top STOXX risers, jumping 11.6 percent,
after confirming an order for its sensors.
On the downside, Covestro dropped 4.6 percent
after Bayer cut its stake in the plastics maker to
44.8 percent from 53.3 percent.
Investors were also looking ahead to the British election on
Thursday, as well as the European Central Bank's policy meeting.
"Whatever the outcome on Friday morning, markets actually
have very little to go on to be able to judge whether such a new
government would be more or less successful in negotiations with
the EU," Don Smith, chief investment officer at Brown Shipley,
said in a note.
"We are unlikely to see anything like the huge fluctuations
in markets that occurred in the immediate wake of last summer’s
referendum," Smith added, referring to the Britain's vote last
June to leave the European Union.
(Additional reporting by Danilo Masoni; Editing by Hugh Lawson
and Alexander Smith)