STOCKS NEWS EUROPE-Neste Oil down after Nordea downgrade

Shares in Neste Oil (Other OTC: NTOIF - news) fall over 5 percent after Nordea cuts its rating to "hold" from "buy," citing uncertainty over U.S. policies on biodiesel, including volume targets and tax credits.

Nordea, referring to the U.S. Senate's preparation of a bill which would reinstate a tax credit on biodiesel, says there was a chance such subsidies would be paid only to domestic producers.

"Protectionism has raised its head and the $1 per gallon subsidy might be paid only to domestic producers," Nordea analyst Pasi Vaisanen writes in a research note.

The Finnish oil refiner earlier this month reported a stronger-than-expected rise in quarterly profit as years of investment in its renewable fuels business paid off.

Nordea also said a higher biodiesel blending mandate in the Untied States could help Neste Oil but that there had not yet been official confirmation of such a policy change.

Reuters messaging rm://ritsuko.ando.thomsonreuters.com@reuters.net