(Refiles to add company codes)
LONDON, Sept 27 (Reuters) - European shares fell on Thursday in the grip of anxiety over Italy's budget, with bank stocks the worst-performing as a fall in U.S. bond yields after the Fed's rate rise also weighed.
The leading euro zone stock index slid 0.4 percent with the pan-European STOXX 600 down 0.2 percent as investors digested a rate hike from the Fed and Italian media reports today's budget meeting would be delayed.
Italy's FTSE MIB underperformed, down 1.3 percent with banks Unicredit, Banco BPM, Intesa Sanpaolo, and UBI Banca the worst fallers, down 2.4 to 3.6 percent as government bonds sold off.
Italy's banks index fell 2.7 percent, while euro zone banks, which have been highly sensitive to Italian budget news, fell 1.3 percent.
Investors have been anxious about Italy's budget which some fear could lead to a blowout of the country's deficit, and put the coalition government on a collision course with the European Union.
In positive moves, H&M jumped 11.7 percent.
The Swedish fashion retailer reported a bigger than expected 20 percent fall in quarterly profit as a new logistics system suffered teething troubles and inventories of unsold stock grew.
Stronger than expected margin figures helped investors shrug off the one-off hit from logistics problems, traders said.
Weak results caused some sharp moves lower.
Drugmaker Indivior fell another 8.1 percent, adding to losses after a 16.5 percent dive on Wednesday after it slashed its revenue forecasts for its opioid addiction drug Sublocade.
IG Group fell 8.7 percent after the online financial trading firm said its CEO Peter Hetherington would step down immediately, the latest blow for the stock which fell sharply after weak results last week. (Reporting by Helen Reid)