European shares fall from three-month high as EDF slumps

(ADVISORY- Reuters plans to replace intra-day European and UK stock market reports with a Live Markets blog on Eikon - see cpurl://apps.cp./cms/?pageId=livemarkets for site in development. See the bottom of the report for more details)

* FTSEurofirst 300 falls back

* Germany underperforms after weak Ifo

* EDF (Paris: FR0010242511 - news) drops on capital raising plans

* Philips (Amsterdam: PHIA.AS - news) sees possible lighting IPO drag on shares

By Alistair Smout

LONDON, April 25 (Reuters) - European shares fell further below last week's three-month high on Monday, as weak mining stocks and a drop in French utility EDF weighed on the market.

The pan-European FTSEurofirst 300 index was down 0.4 percent at 1,366.99 points, nearly 2 percent off last Thursday's peak, which was its highest level since January.

Germany's DAX was down 0.5 percent after a report showed German business morale fell in April. The German Ifo business climate index came in at 106.6 in April, missing a consensus forecast of 107.

The biggest decline on the FTSEurofirst 300 was EDF's 7.6 percent loss. The French utility has delayed a decision on its Hinkley Point nuclear project, but it has secured a state-backed financing package, which put pressure on the shares.

"We assume the capital increase will take place at a circa 15 percent discount to the share price," Exane BNP Paribas said in a note, cutting its target price to 10 euros and reiterating an "underperform" rating on the stock. "Our EPS estimates are lowered to reflect the dilution from the capital increase."

Philips also fell, and was down 5.5 percent after releasing its first-quarter results. Profit beat expectations, but Philips said it was likely to float its lighting division in an initial public offering.

That disappointed some investors, who had been hoping that the Dutch medical equipment and services company might be able to sell the unit.

Mining stocks also fell, with Anglo American (LSE: AAL.L - news) and BHP Billiton dropping 6 percent and 5 percent respectively, as the price of copper weakened.

Oil and gas shares 1.3 percent, as crude prices pulled back after a strong three-week run.

Today's European research round-up

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Mike Dolan, Markets Editor EMEA. (Editing by Larry King)