European shares retreat from 11-month high, Actelion and Colruyt fall

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* STOXX ends down 0.5 percent

* Actelion (LSE: 0QMN.L - news) slumps as J&J ends potential deal talk

* Colruyt (EUREX: 11884447.EX - news) falls after results

* Greek shares underperform

By Atul Prakash and Danilo Masoni

LONDON/MILAN, Dec 14 (Reuters) - European shares fell from an 11-month high on Wednesday, with Switzerland's Actelion slumping after U.S. healthcare company Johnson & Johnson ended discussions over a potential deal with Europe's largest biotech firm.

Actelion shares fell 9.2 percent after J&J said it was not able to reach an agreement that it believed would create adequate value for its shareholders. J&J said in November it was in preliminary talks about a takeover of Actelion, then valued at about $20 billion.

Sources said Actelion was now in talks with French drugmaker Sanofi (LSE: 0O59.L - news) about a deal. Sanofi shares fell 2.6 percent.

Colruyt also put pressure on the broader market as its shares fell 9.4 percent after the Belgian supermarket group announced results late on Tuesday. Even (Taiwan OTC: 6436.TWO - news) though net profit beat market expectations investors were disappointed by its weak growth outlook.

The pan-European STOXX 600 ended down 0.5 percent, with healthcare and consumer staples sectors the biggest drags on the benchmark index.

Investors awaited a policy meeting of the U.S. Federal Reserve for hints about the market's near-term direction. A quarter point move is priced in, as are two more hikes next year. Any hint that the Fed may move more aggressively could affect various markets.

"Although there should be no surprises given the very much anticipated 25 basis points hike at today's meeting, the FOMC's accompanying statement and the Fed's dot plot will set the primary tone for the 2017 outlook for the U.S. monetary policy," said Ipek Ozkardeskaya, analyst at London Capital Group.

Italian banks fell 2.8 percent. Rating agency Moody's changed its outlook on the Italian banking sector to negative from stable late on Tuesday due to increasing capital needs and weakening confidence.

Shares (Berlin: DI6.BE - news) in Monte dei Paschi (Milan: BMPS.MI - news) di Siena fell 2 percent as the troubled Italian lender confirmed the European Central Bank had rejected its request for more time to raise capital.

The Greek blue chip index fell 3.2 percent, weighed down by heavy losses among its banks after the euro zone's bailout fund said it had put short-term debt relief measures for the country on hold.

However, strong gains by some companies limited losses.

German retailer Metro (Dusseldorf: 62M.DU - news) jumped 3.6 percent after reporting better than expected fourth-quarter operating profit for the food and consumer electronics businesses it hopes to split in a demerger next year.

Mediaset (LSE: 0NE1.L - news) extended the previous session's 30 percent rally and was up 1 percent as top shareholder Fininvest and Vivendi (LSE: 0IIF.L - news) both raised their stakes in the Italian broadcaster. Mediaset shares have jumped more than 75 percent in about two weeks. (Editing by Alison Williams)